PUBLIC EXPENDITURE REVIEW OF THE Water, Sanitation, and Hygiene Sector of Malawi
February 2020 WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 i PUBLIC EXPENDITURE REVIEW © UNICEF/2016/Sebastian Rich © UNICEF/2016/Sebastian
ACKNOWLEDGEMENTS
Appreciation goes to all individuals and institutions that Muchabaiwa, Patrick Okuni, Nkandu David Chilombo, Alessandro contributed to the development of this PER. The Government Ramella Pezza, Kelvin Tapiwa Mutambirwa and Chimwemwe would like to thank staff from several Ministries, Departments Nyimba for the technical and logistical support. and Agencies (MDAs) who were involved in this PER. Specifically, appreciation goes to staff from the M&E Division under the The Government would also like to deeply thank the Oxford Economic Planning and Development (EP&D) of the Ministry of Policy Management (OPM) consultancy team – comprising of Finance; the Water Supplies Department under the Ministry of Nick Hall (team leader), Zach White (project manager), Tuntufye Agriculture, Irrigation and Water Development (MoAIWD); and Mwalyambwire, and Tim Cammack for providing technical the Environmental Health Department under the Ministry of support that enabled the production of this PER. Also the OPM Health and Population (MoHP). staff that worked in the background to make this exercise a success are appreciated. Sincere gratitude goes to the following Government staff – Sophie Kang’oma, Victoria Geresomo, Richard Jack Kajombo, Gringoster The analysis in this PER draws on scores of interviews with Kajomba and Stevier Kaiyatsa from the EP&D; Emma Mbalame, district staff, with a list of those interviewed or consulted Bibo Charles Yatina and Gertrude Makuti Botomani from the provided in Annex I. The Government is extremely thankful to all MoAIWD; Allone Ganizani, Holystone Kafanikhale, Samuel district for their inputs. Ligowe and Flora Dimba from the MoHP, Paul Chunga from the Lilongwe District Health Office, Esther Rajabu from the National Statistics Office (NSO), Pilirani Mbedza, Dhumisani Msowoya, Adam Chikapa Guys, Fyness Mwafulirwa, Sangwani Phiri and
Mphatso Elias Ackim from the Parliamentary Budget Office Oxford Policy Management Limited (PBO). The Government would also like to extend its gratitude Registered in England: 3122495 to the following – Gloria Nyirenda and Hopeson Chaima from the Level 3, Clarendon House 52 Cornmarket Street Water and Environmental Sanitation Network (WESNET), Egolet Oxford, OX1 3HJ Roberts from the PRDO. United Kingdom Tel: +44 (0) 1865 207 300 Fax: +44 (0) 1865 207 301 Special thanks goes to UNICEF for providing financial, technical Email: [email protected] Website: www.opml.co.uk and logistical support which enabled the production of this PER. Twitter: @OPMglobal Specifically, the Government wishes to thank the following Facebook: @OPMglobal YouTube: @OPMglobal UNICEF team – Beatrice Targa, Michele Paba, Bob Libert LinkedIn: @OPMglobal MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW ii © UNICEF/2009/Pirozzi
EXECUTIVE SUMMARY
Context ministries: the Ministry of Agriculture, Irrigation and Water Development (MoAIWD) has overall responsibility for water Over the Millennium Development Goals (MDGs) period service provision and water resource management; the Ministry (2000–2015) Malawi made good progress on increasing of Health and Population (MoHP) leads on sanitation and hygiene access to basic water, sanitation and hygiene (WASH) promotion, including the management of frontline staff; and the services. MDG 7c, ‘Halve, by 2015, the proportion of the Ministry of Local Government and Rural Development (MLGRD) population without sustainable access to safe drinking water is responsible for supporting sector ministries to reform in line and basic sanitation’ was met in terms of access to water, while with decentralisation, and to support district governments to there was only ‘moderate progress’ on sanitation. Malawi’s level adopt their devolved functions. of access to improved water services is substantially higher than the sub-Saharan African average and that of regional and income-group peers. National averages do, however, mask sharp WASH sector financing inequities in service provision. Access to water and sanitation Despite limited fiscal space, the Government of Malawi services varies widely between districts and across wealth (GoM) has increased budget allocations to WASH since quintiles. 2017/18, mainly due to the introduction of the Borehole Fund. Over the period of this public expenditure review (PER), Malawi has extremely limited fiscal space. Malawi’s poverty 2014/15 to 2018/19, GoM funding of the sector has averaged at incidence is among the worst in sub-Saharan Africa, with gross 0.39% of total government expenditure, or just under 0.1% of domestic product (GDP) per capita at just $389 in 2018. GDP GDP. The average in the three years before the Borehole Fund grew at 4.0% in 2018 and 5.1% in 2019, and is expected to reach was 0.32%, and then 0.49% thereafter. 6% in the medium term. In 2018, inflation was brought down to single digits after many years of double-digit inflation. However, GoM budget allocations to WASH as a proportion of GDP is low compared to that of other countries in the WASH service delivery in Malawi region. Available data show that the Malawi Government’s allocation of resources to WASH is 0.081% of GDP, which is only The legislation underpinning the sector establishes clear 55%, 52%, 43%, and 27% of that allocated by Kenya, Zambia, roles and responsibilities. Service delivery functions are Ghana and Mali, respectively; the per capita allocation is less performed by the district councils and the water boards, with the than one-fifth of those countries. water boards focused on urban areas. Operation and maintenance functions for rural water systems are performed by water users associations (WUAs). At the national level there are three key WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 iii PUBLIC EXPENDITURE REVIEW
target highlights the sector is currently funded to just above 30% of the target level. A critical assumption behind the SIP projections is that donors would ‘step up’ grant financing to the sector. The withdrawal of many donors is a key reason for this financing gap emerging.
Water sector expenditure and progress WASH sector expenditure is heavily weighted towards water, and less towards sanitation and hygiene. Over the PER period an average of 65% of GoM funding went to the water sub- sector and 35% went to hygiene and sanitation. The water sub- sector is dominated by capital expenditure. Over 80% of GoM expenditure over the five-year period was capital expenditure. There was little GoM capital expenditure at district level until the introduction of the District Development Fund (DDF) in 2015-16, with the Borehole Fund later leading to a sharper increase.
Water board revenue has increased dramatically over the PER period, both in absolute and real terms. The growth in
© UNICEF/2009/Pirozzi revenue has primarily been driven by increased revenues from institutional and commercial sources, and due to price increases, Malawi remains reliant on external sources of financing to rather than an expansion in services. Across all sources revenue drive investments in the WASH sector. The ratio of Malawi’s per m3 increased, in real terms: 32% between 2014/15 and external funding to financing from domestic resources is 8.8, 2018/19 – equivalent to a 123% rise in prices in nominal terms. much higher than Kenya’s 2.9 and Zambia’s 2.0, and higher still than Mali’s and Ghana’s. This is despite Malawi’s comparatively There is no regulator in Malawi; as per the Waterworks low funding from external sources measured in per capita terms. Act 1995 it is MoAIWD that regulates tariffs in the sector. Malawi receives $3.2 per capita external funding for WASH, The current tariff policy is implicitly pro-poor in that there is a compared to Kenya’s $6.2 and Zambia’s $4.2. External funding substantial cross-subsidy between commercial and institutional to the sector has fallen sharply in recent years, with many rates and kiosk users. However, the loose regulatory environment bilateral donors leaving the sector. Additionally, the composition and cross-ministerial responsibilities for water board oversight, of external finance has changed over the PER period as new combined with the recent substantial price rises, point towards external funding is almost exclusively directed to urban WASH, the need to review tariff rates and policy, as well as the need for via the water boards, and as loans as opposed to grants. Since greater oversight of utility performance. While the water boards 2014 donors to Malawi are apparently giving less priority to report year-on-year increases in the number of connections, the WASH. While total official donor development assistance (ODA) volume of water supplied has not increased greatly and non- to Malawi has risen since 2014, the proportion of ODA provided revenue water remains stubbornly high. to the WASH sector has dropped by two-thirds. A large proportion of the household expenditure is spent Household expenditure is the single largest source of on providers other than the water boards. This expenditure is financing to the sector, accounting for nearly 60% of sector potentially a ‘blind spot’ in policymaking as these expenditures financing. In 2016 households were estimated to spend are not regularly tracked. This non-water board household Malawian Kwacha (MKW) 35 billion (2016 prices) on water – expenditure is substantial and represents 16.8% of funding 36% of which was directed to water boards. As such, 64% of to the sector, as much as two-thirds of GoM and donor (ODA) household expenditure on water is spent on other providers. expenditure combined. Much of this expenditure is likely These are likely to include: fees paid to WUAs; expenditure on associated with WUAs, and more effectively leveraging this self-supply; and expenditure on purchasing water from informal expenditure towards sector outcomes requires a focus on and formal private sector actors. professionalising the community-based management models used in Malawi. The Water Sector Investment Plan (SIP) (2012) outlines that $140 million is needed annually between 2015 and 2030 in Access to basic water service is high in Malawi – 85% as per order for the sector to achieve 98% access to improved water the latest census. However, there has been little progress in supply by 2025 and 90% access to improved sanitation by last four years, and improvements have not been pro-poor. While 2030. A comparison of the sector expenditure against the SIP the Borehole Fund has increased funding to the sector, there are MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW iv
concerns surrounding how efficiently this is being spent. Funds in of external investment in the sector in the run-up to the MDG are often spent by constituency members of parliament (MPs) deadline, and progress in rural sanitation is heavily dependent on private contractors, without the District Water Development on external funding. The number of ‘open defecation free’ (ODF) Officer having a role in technical oversight. traditional authorities is a key measure of progress in sanitation. As at December 2018, 112 of Malawi’s 263 traditional authorities In recent years there has been moderate progress on (TAs) had been declared ODF. Implementation in 86 of these 112 improving water point functionality in some districts, but TAs had been funded by external partners. The rising rates of a marked drop in others. Nationally, water point functionality open defecation are seen to be associated with a lower level of fell from 77% to 71% between 2016/17 and 2017/18. Efforts to donor engagement in the sector, and with the physical collapse improve functionality in rural areas have centred on training area of household latrines. mechanics and linking these to shop partners who stock parts. This PER also highlights challenges associated with low other Progress in rural sanitation is heavily dependent on frontline recurrent transactions (ORT) funding and inadequate staffing. staff being able to travel to communities to conduct health The number of water monitoring assistants (WMA) per person promotion. There is a target ratio of one Health Surveillance in the district averages 1:230,966. The sector vacancy rate for Assistant (HSA) per 1,000 of population. The current average ratio established positions was 68% in 2017/18. of HSAs to population is 1:1,921, well below the target rate. This suggests that frontline preventative healthcare is understaffed. Sanitation and hygiene expenditure and progress Analysis of access by wealth quintile and region highlights GoM expenditure in the sanitation and hygiene sub-sector is that the progress on open defecation has largely been dominated by salaries. This reflects implementation activities, pro-poor, although inequalities still exist. In all regions and which are predominantly based around district-level health nationally the rate of reduction was largest among the poorest promotion activities. District-level salaries are nearly 70% of wealth quintile. While this is partially a reflection of the fact that GoM sub-sector expenditure. There is no identified GoM-funded rates were higher to begin with it does highlight that spending development expenditure on hygiene and sanitation, and over and efforts in reducing open defecation benefit the least wealthy the PER period there was no substantial change in GoM funding in society. Eliminating open defecation will by definition entail to the sector (in real terms). reaching all households in Malawi and this unambiguously requires targeting the very poorest. Nationally, open defecation rates fell from 13% in 2008 to under 6% in 2015, but have since risen to over 7% in 20181. The progress in the period 2008–2013 was related to a crowding
1 2008 and 2018 data are census data; 2015 data are DHS data. © UNICEF/2012/Nesbitt WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 v PUBLIC EXPENDITURE REVIEW
Alignment with policy objectives Overall, all spending is aligned with elements of national A sector-wide approach (SWAp) in WASH has long been policies. The critical challenge is that the sector is substantially considered and is a stated policy aim of GoM, and is also an underfunded against the investment plan, meaning some international policy commitment. There are some institutional aspects of policy receive little attention. The different sub- apparatuses associated with a SWAp (joint sector reviews, sectors rely on different funding streams. The sanitation sub- technical working groups, etc), and these are seen as beneficial sector is comparatively exposed to changes in donor financing. to sector functioning. However, many donors remain unwilling to In water, the Borehole Fund has been successful in mobilising pool funds due to fiduciary risks. Even without budget support, funds for the rural water sub-sector, though there are concerns other SWAp financing models are available. Both the health and surrounding how efficiently this is being spent and functionality education sectors now have new SWAp funding models – such remains a critical issue in rural areas. In sanitation and hygiene, as Health Services Joint Fund (HSJF) and the Education Sector the lack of a dedicated sector fund may be a contributing factor Joint Fund, which avoid the risks associated with budget support to the extremely low GoM allocations to the sector. – that offer a blueprint for the WASH sector.
Progress in any of the individual sub-sectors is dependent The latest sector report highlights the need to agree an on the degree to which different financing sources align. This approach to achieving the Sustainable Development PER has highlighted the importance of household, donor, and Goals (SDGs), as well as deciding the degree to which water board expenditure in achieving sector outcomes. MoAIWD global progress indicators can be integrated with national and MoHP have a central role in effectively coordinating these progress indicators (especially in rural sanitation). As Malawi funding streams through policy, regulation, and sector leadership. approaches universal access to basic services much of the effort Where donors and non-governmental organisations (NGO) focus to meet the SDGs needs to be focused on raising service levels their programmes has a strong influence on who is reached and ensuring the quality and sustainability of supplies. The level with services. The recent trend in donor funding to be primarily of ambition in the SDGs as regards ‘safely managed’ services is channelled to urban areas and through the water boards means substantially above that of the MDGs’ references to access to that the funding for rural areas, where the majority of those ‘basic’ or ‘improved’ services. without services are located, is disproportionately low in relation to need. © UNICEF/2012/Nesbitt MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW vi © UNICEF/2015/Chikondi
Recommendations
Recommendation area 1: increased government financing of the service delivery functions of the water boards or district WASH, especially ORT. Despite limited fiscal space for overall councils. Investing in WUA capacity is likely to contribute to financing of WASH, funding for operation and maintenance improved sector outcomes on functionality if it means non- is such a small proportion of the total that a large increase in water board household expenditure is spent more effectively funding may be possible. Related to this, it is appropriate for the in the sector. sector to lobby for enhanced budgetary decentralisation, so that allocations between sectors of expenditures, such as ORT, can Recommendation area 5: sufficiency of frontline staff. be decided at the local authority level. There is a shortage of frontline staff in both the water and sanitation sectors. New recruitment of frontline staff should Recommendation area 2: the use of conditional grants be prioritised in those districts with the greatest staff deficit and funds for financing WASH services at district level. The per population and in relation to service levels. development of a targeted preventative health fund to support sanitation and hygiene promotion may contribute to increasing Recommendation area 6: adjusting to reductions in sector financing, following the example of the Borehole Fund. external funding. In the more constrained external funding However, there is a need for strong oversight of these funds by environment there is a need for increased donor and GoM district councils or ministries, departments and agencies (MDA); coordinating in prioritising remaining resources around ‘core’ and there is currently a need to strengthen the oversight of the sector functions that need to be in place (including monitoring implementation of the Borehole Fund. and oversight). The new large injections of external resources to the sector that are channelled to water boards underscores Recommendation area 3: enhanced identification of GoM the importance of effective sector coordination between the WASH expenditures. A separate ‘sanitation and hygiene’ sector water boards, MDAs, and donors. (or cost centre) at district level (as for water) is likely to empower environmental health staff with more funds and more attention Recommendation area 7: adoption of stronger SWAp to sanitation; and would also facilitate better tracking of overall processes in the WASH sector. It is recommended that WASH expenditures. stronger SWAp processes be adopted both centrally and at district level, including an added emphasis on aid Recommendation area 4: professionalising the community- coordination. This approach could include SWAp funding, based management model. Dedicated capacity-building preferably at district level, with special fiscal controls. The packages should be developed to support WUAs in service health and education sectors are already adopting innovative delivery. MoAIWD should lead in providing clearer policy approaches that can be mirrored for the WASH sector. guidance on their governance structures and links to the formal The use of stronger SWAp processes can facilitate higher sector (water boards or district councils). Where appropriate, efficiency and effectiveness in the use of donor and NGO WUA service delivery functions should be more clearly linked to resources. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 vii PUBLIC EXPENDITURE REVIEW
TABLE OF CONTENTS
Acknowledgements i 6 SECTOR PERFORMANCE 35 Executive summary ii 6.1 Access to improved drinking water 35 Table of contents vii 6.2 Sanitation and hygiene 40 List of tables, figures, and boxes viii 6.3 Progress on WASH by district 43 List of abbreviations x 6.4 Alignment between sector spending and sector policy 44
1 INTRODUCTION 1 7 DISCUSSION AND CONCLUSIONS 48 1. 1 Objectives and scope of the PER 1 7. 1 Government financing in WASH 48 1. 2 Structure of the PER 2 7. 2 External WASH financing 49 1. 3 Approach and methodology 2 7. 3 Water board expenditure and performance 50 7. 4 Household expenditure 50 2 NATIONAL CONTEXT 5 7. 5 Financing in emergencies 51 2.1 Macro-economic situation 5 7. 6 WASH expenditure tracking and general PFM processes 51 2.2 Government revenues and expenditure 7 2.3 Government budget credibility experience 10 8 RECOMMENDATIONS, WITH LESSONS LEARNT 52 2.4 External support 10 2.5 Public Finance Management (PFM) in Malawi 11 REFERENCES 54
3 WASH SERVICE DELIVERY IN MALAWI 14 Annex A - Details of the budget cycle 55 Annex B - Overview of key WASH sector legislation, policy, and strategy 57 4 WASH FINANCING FINDINGS 16 Annex C - Mapping of key donor projects 60 4.1 Government financing of WASH 16 Annex D - Technical note on the use of JMP and survey data 61 4.2 External financing for WASH 18 Annex E - District level progress data tables 63 4.3 WASH financing by households 18 Annex F - Household expenditure estimates by district 66 Annex G - Stakeholder mapping in rural water supplies 71 5 EXPENDITURE FINDINGS 20 Annex H - Sector staffing and PE costs 72 5.1 Government WASH Expenditures 20 Annex I - Stakeholders interviewed 74 5.2 Donor and NGO expenditures on WASH 24 Annex J - Specific sources, assumptions and calculations 77 5.3 Water board revenue 29 5.4 Household expenditure 30 5.5 Expenditure in emergencies 31 5.6 Total sector expenditure 32 5.7 Analysis of all WASH expenditures by sub-sector 33 MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW viii
LIST OF TABLES, FIGURES, AND BOXES
TABLES Table 33 Household water expenditure estimates 2016 (IHS 4) 67
Table 1 Key financing flows and data sources 2 Table 34 Household water expenditure estimates 2010 (IHS 3) 68 Table 2 Primary data collection tools 3 Table 35 Household soap expenditure estimates 2016 Table 3 Inflation indices used to adjust to 2014/15 prices 3 (IHS 4) 69 Table 4 Assessing sector performance 4 Table 36 Household soap expenditure estimates 2010 Table 5 Description of GoM budget elements 9 (IHS 3) 70 Table 6 MDA responsibilities for water and sanitation 14 Table 37 Household expenditure 2010-2016 (MWK 2016 prices) 71 Table 7 Water sector expenditure – economic classification (MWK million – 2014/15 prices) 21 Table 38 District-level staffing – sanitation 72 Table 8 Sanitation and hygiene sub-sector expenditure – Table 39 District-level staffing – water 73 economic classification (MWK million – 2014/15 prices) 23 FIGURES Table 9 ORT budget execution data for the water sector at districts (MWK million, nominal) 23 Figure 1 Performance of key macro-economic indicators 6 Table 10 DDF budget allocation and execution (MWK million – 2014/15 prices) 23 Figure 2 Composition of GDP by sector 7 Table 11 Externally funded WASH expenditure (MWK Figure 3 Evolution of Income inequality* 7 billion) 27 Figure 4 Government revenue (MWK billion – June Table 12 Invoiced sales of the five water boards (MWK 2014/15 prices/real and actual/nominal) 8 million – 2014/15 prices) 29 Figure 5 Key elements of GoM-financed expenditure 9 Table 13 Post-tax profit of four of the five water boards in Figure 6 GoM-wide budget execution experience based 2017 (MKW million – nominal) 29 on averages of the five years 2014/15 through to Table 14 Estimated household expenditure on WASH 2018/19 10 items (2016) 30 Figure 7 Grants revenue (MWK billion – June 2014/15 Table 15 Estimations of household expenditure 30 prices/real and actual/nominal) 10 Table 16 Total sector expenditure by source (MWK billion Figure 8 ODA to Malawi by type of aid and delivery – real 2014-15 prices) 32 channel (constant 2017 USD millions, disbursements) 11 Table 17 Total sector expenditure by source (MWK billion – nominal) 33 Figure 9 Comparison of government WASH financing from domestic revenues between seven sub- Table 18 Expenditure by sub-sector by funding source Saharan African countries (% of GDP and USD (MWK billion, 2014/15 prices) 34 per capita) 16 Table 19 Expenditure by sub-sector by funding source Figure 10 GoM financing of WASH over five years, as a (MWK billion, nominal) 34 proportion of TGE and GDP, and per capita (MWK Table 20 Number of active connections 36 2014/15 prices) 17 Table 21 Non-revenue Water (NRW) for the period Figure 11 Comparison of external financing of WASH 2016/17-2017/18 37 between six sub-Saharan African countries (% of Table 22 Progress on ODF declaration 41 GDP and USD per capita) 18 Table 23 Expenditure against investment plan and Figure 12 Ratio of external financing of WASH to funding financing gap 45 from government domestic resources in six sub- Saharan African countries 18 Table 24 Cost of implementing the National Sanitation and Hygiene Strategy 2018–2024 (MKW million) 46 Figure 13 Comparison of expenditures on WASH by households between seven sub-Saharan African Table 25 Key legislation relevant to the WASH sector 57 countries (% of GDP and USD per capita) 18 Table 26 Key sector policies 57 Figure 14 Comparison of relative proportions of WASH Table 27 Key sector strategies 58 financed by households, external sources, and Table 28 Key sector institutions, their responsibilities, and government 19 functions 59 Figure 15 GoM WASH expenditures – economic Table 29 Key externally financed projects 2012-2018 60 classification summary (MWK millions, real – 2014/15 prices) 20 Table 30 Access to an improved drinking water source by district and region (2010-2018) 63 Figure 16 GoM WASH expenditures by sub-sector (MWK million, both real 2014/15 prices and actual/ Table 31 Open defecation rates by district and region nominal prices) 21 (2010-2018) 64 Figure 17 Water sector expenditure – economic Table 32 Access to an improved or traditional latrine by classification (MWK million – 2014/15 prices) 22 district and region (2010-2018) 65 WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 ix PUBLIC EXPENDITURE REVIEW
Figure 18 Sanitation and hygiene sub-sector expenditure – Figure 37 Proportion of the population with access to an economic classification (MWK million – 2014/15 improved water source by region and wealth prices) 22 quintile 2010–2016 39 Figure 19 District water sector ORT funded (MWK million Figure 38 Per capita Borehole fund allocations vis-a-vis – actual/nominal and 2014/15 prices) 23 access to improved water sources by district. 40 Figure 20 Donor WASH ODA commitments 2011–17 (2016 Figure 39 Proportion of the population defecating in the prices USD millions) 24 open 40 Figure 21 WASH sector disbursements as a proportion of Figure 40 Number of ODF TAs by funding partner 41 total ODA disbursements 25 Figure 41 Ratio of HSAs* to population in districts 42 Figure 22 Commitments vs disbursements to WASH (2016 Figure 42 Proportion of the population defecating in the prices USD millions) 25 open by region and wealth quintile 2010–2016 43 Figure 23 Disbursements by delivery channel (govt. vs Figure 43 District-level progress on access to improved NGO) by funder (multilateral vs. bilateral) (2016 water sources and an improved or traditional prices USD millions) 26 latrine (2013–2018) 44 Figure 24 Commitments by grant and loan 2010-2017 (2016 Figure 44 Global costs of meeting the SDGs 48 USD millions) 26 Figure 45 The MTEF and the Budget Cycle 55 Figure 25 Externally funded WASH expenditure (MWK billion) 27 Figure 46 JMP sanitation estimates 2017 and 2019 data release 62 Figure 26 Invoiced sales of the five water boards (MKW million – 2014/15 prices) 29 Figure 47 District level progress on improved water and open defecation 66 Figure 27 Income per m3 invoiced (MKW 2014/15 prices) 30 Figure 48 Rural water supply stakeholder mapping 71 Figure 28 Water board water volume invoiced mil-m3 30 Figure 29 Household expenditure 2010–2016 (MWK 2016 prices) 31 BOXES Figure 30 Trends in total expenditure 32 Figure 31 Proportions of total expenditures over four Box 1 Key Sector policy and service delivery issues 15 sources 33 Box 2 International policy commitments 46 Figure 32 Sub-sector expenditure 2018/19 (MWK billion, Box 3 Sources, assumptions and calculations of water nominal) 33 sector GoM expenditures 77 Figure 33 Access to improved drinking water source Box 4 Sources, assumptions and calculations of (2008–2018) 35 sanitation and hygiene GoM expenditures 78 Figure 34 Water point functionality and access by district 36 Box 5 Assumptions for sub-sector analysis 78 Figure 35 Ratio of WMAs to population in districts 37 Figure 36 ORT per capita* and water point functionality 38 MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW x
LIST OF ABBREVIATIONS
AfDB African Development Bank MoAIWD Ministry of Agriculture, Irrigation and Water Development CDF Constituency Development Fund MoHP Ministry of Health and Population CRS Creditor Reporting System MTEF Medium-term Expenditure Framework DAC Development Assistance Committee (OECD) NGO Non-Governmental Organisation DCT District Coordinating Team NLGFC National Local Government Financing Committee DDF District Development Fund NRW Non-Revenue Water DEHO District Environmental Health Officer NRWB Northern Region Water Board DFAT Department of Foreign Affairs and Trade (Australia) O&M Operation and Maintenance DFID Department for International Development (UK) ODA Official Development Assistance DHRMD Department of Human Resources and Management Development ODF Open Defecation Free DHS Demographic and Health Survey OECD Organisation for Economic Co-operation and Development DODMA Department of Disaster Management Affairs OPM Oxford Policy Management DWDO District Water Development Officer ORT Other Recurrent Transactions EP&D Economic Planning and Development PBB Programme-Based Budgeting FY Financial Year PE Personal Emoluments GDP Gross Domestic Product PEFA Public Expenditure and Financial Accountability GLAAS Global Analysis and Assessment of Sanitation and Drinking-Water PER Public Expenditure Review GoM Government of Malawi PFM Public Financial Management HSA Health Surveillance Assistant PPP Public–Private Partnership HSJF Health Services Joint Fund SDGs Sustainable Development Goals IBNET International Benchmarking Network for Water SRWB Southern Region Water Board and Sanitation Utilities TA Traditional Authority IFMIS Integrated Financial Management System TGE Total Government Expenditure IHS Integrated Household Survey UNICEF United Nations Children’s Fund IMF International Monetary Fund USD US Dollar MDAs Ministries, Departments, and Agencies VLOM Village-Level Operation and Maintenance MDGs Millennium Development Goals WASH Water, Sanitation, and Hygiene MGDS Malawi Growth and Development Strategy WESNET Water and Environmental Sanitation Network MICS Multiple Indicator Cluster Survey WHO World Health Organization MP Member of Parliament WMA Water Monitoring Assistant MWK Malawian Kwacha WUA Water Users Association MLGRD Ministry of Local Government and Rural Development WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 1 PUBLIC EXPENDITURE REVIEW © UNICEF/2015/Chikondi
1. INTRODUCTION
This WASH public expenditure review (PER) is a concise and WASH sector and improve expenditure management. More focused study, aimed at understanding the spending patterns and specifically, the PER generates evidence and analysis on the financing of WASH services in Malawi. The PER complements a efficiency, effectiveness, equity and sustainability of WASH range of researches and policy analysis work aimed at mapping expenditures, as guided by relevant WASH strategies and sector and analyzing decision-making, financial flows, allocation criteria plans. Findings from the PER are useful to inform development, and spending levels relevant to WASH services to inform financing and implementation of WASH interventions in Malawi. advocacy and to promote equitable and sustainable WASH The PER is anchored around three primary objectives: services for children. The results from this PER feed into ongoing discussions on development and implementation of the third • To assess sources of revenue and financing structure of National Water Development Programme and the new National WASH programs and interventions in Malawi. Open Defecation Free (ODF) and Hygiene Strategy. Additionally, • To analyze the size, composition, equity and effectiveness the PER provides baseline information on WASH expenditure of WASH spending. performance in Malawi. • To set out a range of options and recommendations to improve the quality of WASH spending in order to benefit all This PER was produced under the guidance of a technical children in Malawi. working group with cross-departmental representation from the M&E Division of the Department of Economic Planning and Through a collaborative UNICEF-GoM approach, a secondary Development (EP&D), the Water Supplies Department under objective of the PER was to build the capacity of the Government the Ministry of Agriculture, Irrigation and Water Development of Malawi in public expenditure analysis. (MoAIWD), the Environmental Health and Sanitation Department under the Ministry of Health and Population (MoHP), the National The PER covers a period of five fiscal years from 2013/14 to Statistics Office (NSO), Civil Society representation through 2018/19. The review included a wide range of components, WESNET. The United Nations Children Fund (UNICEF) provided focused on six key areas: (I) a review of the Malawi WASH the financial, technical and logistical support that enabled the context; (ii) a sector review of financing, budget allocation, and production of this PER. The Oxford Policy Management (OPM) national expenditures on WASH in Malawi, and an analysis of provided the technical backstopping in the entire PER process. sector performance; (iii) an assessment of the critical budget and expenditure challenges and how they influence service 1.1 Objectives and scope of the PER delivery; (iv) district-level insights into the factors affecting budget decisions, and those factors affecting budget execution, The overarching goals of the PER are to assist the Government efficiency, and equity; (v) stakeholder workshops; and (vi) of Malawi to analyse public expenditure and performance in the developing policy options and recommendations. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 2
1.2 Structure of the PER The sector performance analysis drew on data from nationally representative surveys and MoAIWD sector performance The remainder of the report is structured as follows: Section 1.3 reports. Table 1 provides an overview of the data collected for provides details of the approach and methodology. Sections 2 and different funding sources. 3 provide a summary of the sector context, covering: an overview of the macro-fiscal context in Malawi, a description of key public financial management (PFM) processes and their performance, TABLE 1 Key financing flows and data sources and an overview of the structure of the WASH sector in Malawi. Section 4 provides an analysis of sector financing, comparing Source/flow Description Key data sources Malawi to regional peers for which there are data. Section 5 Domestic • Budget and • Budget reports, funding public expenditure of reports, and IFMIS presents the findings related to sector expenditure – this includes transfers MDAs (Ministries, reports (secondary) – an analysis of government, water board, donor, household, and Departments and see discussion below emergency expenditures in the sector. Section 6 presents the Agencies). for details of the documents used. analysis related to sector performance and efficiency and equity • Budget and expenditure by considerations. Section 7 discusses the key findings by thematic districts. area. Section 8 presents recommendations. International • Transfers by • OECD-DAC creditor public international donors reporting system (CRS) 1.3 Approach and methodology transfers to government (secondary). institutions classified as ODA. • WESNET data 1.3.1 Data sources and data collection (secondary). • This includes on- Data collection was both quantitative and qualitative. Data budget and off-budget • NGO/development on GoM expenditures were collected from various sources, expenditure. partner questionnaire (primary). including the integrated financial management system (IFMIS) Voluntary • NGO expenditure • WESNET data and treasury reports. Data on water board expenditures were transfers funded from private (secondary). drawn from corporate and management accounts shared with sources (i.e. non- OECD Development • NGO/development the PER team. Data on household expenditure were estimated Assistance Committee partner questionnaire from expenditure surveys. Data on donor expenditure drew (DAC) sources). (primary). on various sources, including: Organisation for Economic Co- Tariffs • Tariff collection by • Data from water operation and Development (OECD) development assistance the water boards boards on revenues and water board and expenditures committee (DAC) data; WESNET data on NGO expenditure; and a expenditures. (secondary). survey questionnaire sent by the PER team to donors and NGOs. Expenditure • Revenues and • Living standards on self- expenditure by WUAs, surveys – Integrated supply and by households Household Survey (HIS) on onsite latrines and 3 and 4 (secondary). latrine maintenance. Source: Authors
Data on GoM budgets and expenditures at different levels are reported in different sources and documents and, as such, the PER drew on multiple sources. The secondary sources used for GoM data include the following:
• National-level documents for each year (available online): draft financial statements (Budget Document 3), annual economic report (Budget Document 2); programme- based budget (Budget Document 5). • MDA-level and sub-MDA documents for each year (from Accountant General Department): IFMIS reports for the whole of MoAIWD and the whole of MoHP for each year – called ‘Itemized Comm and Expen Report by Cost Center’, which includes line-by-line details (with up to 8,200 lines each) of budgets, funding, and expenditures; and budget reports for MoAIWD’s Water Services Department and MoHP’s Environmental Health Unit. © UNICEF/2009/Pirozzi WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 3 PUBLIC EXPENDITURE REVIEW
• District-level documents for each year (from National and to six key donors; returns were received from six NGOs and Local Government Financing Committee (NLGFC)): three donors. programme-based budgets (itemised per district); treasury funding reports, per district and per sector; IFMIS budget and 1.3.2 Analysis of financial data expenditure reports; and ‘End of Year Councils Consolidated The analysis of the WASH financial data included the following Cost Centre Report’, itemised per district, per cost centre, core analyses: and per item.
i. Sector financing – Analysis of financing from each main The quantitative data collection at district level was supplemented financing source, in comparison with the sector financing of by qualitative data collection in 10 districts and by questionnaires other countries. completed by WASH staff in all 28 districts. The focus of the qualitative data collection was on understanding the involvement ii. Level and composition of government spending based of various actors in the budget process, the policy priorities of on economic classification – Analysis of WASH GoM districts, and service delivery challenges, and how these relate to expenditures in relation to total government expenditure sector financing. Additionally, a further key aspect of this primary (TGE) and GDP in nominal and real terms. data collection was to gather information that would allow for iii. Budget utilisation and execution – Analysis of budget reliable estimates to be made where budget lines needed to credibility and execution: actual government expenditures be assigned to specific sub-sectors. The scope and focus of the against approved and revised budgets. primary data collection is summarised in Table 2. iv. External expenditures – Analysis of commitments and expenditures of ODA (government to government) and from TABLE 2 Primary data collection tools private sources.
Source/ tool Details v. Water boards – Analysis of expenditure of the five boards. DEHO/DWDO Questionnaires were sent to key staff (District vi. Household expenditure – Estimates of expenditures by questionnaires Environmental Health Officers (DEHOs) and District Water Development Officers (DWDOs)) in members of the public. all 28 districts. These questionnaires focused on gathering information related to: staffing within vii. Total sector expenditure – Analysis of the result of bringing the districts; funding and activities in WASH together government, external, water board, and household over the PER period; donors/NGOs working in expenditures. the district; and their priorities and challenges in WASH. viii. Functional classification – Estimation of each element of NGO/Donor Questionnaires were sent to all prominent donors total sector spending across four sub-sectors. questionnaires and NGOs working in WASH. These focused on gathering information related to: their sources of financing; which districts and sub-sectors their Where data were available with sufficient granularity, they were expenditure is in; and if they distribute funding to sorted and analysed using tailor-made spreadsheet tools. In other NGOs. Interviews in ten Case studies were undertaken in 10 districts some cases there were gaps in required granularity, so estimates District Councils (Rumphi, Lilongwe, Kasungu, Chikwawa, and extrapolations were made from available data. Annex J Machinga, Mzuzu, Ntcheu, Nkhotakota, Phalombe, provides details of sources, assumptions, and calculations for and Mangochi). In these case studies the teams interviewed all key district council staff, frontline GoM expenditure elements, and for the functional analysis. staff, and WUAs. The expenditure analyses include a focus on a comparison of spending over the five years of the PER period, from 2014/15 With the support of officers at MoHP and MoAIWD, respectively, through 2018/19. Much of this analysis is presented with inflation- completed DEHO/DWDO questionnaires were received from all adjusted data (‘real’), in order that the trend over years may be 28 districts – from 292 DEHOs and from 28 DWDOs – a 100% better understood. This is done by presenting data in 2014–15 response rate. NGO/donor questionnaires were sent to 19 NGOs prices. The indices3 used to prepare such inflation-adjusted data
2 Mzimba has two District Health Offices – North and South. are presented in Table 3.
3 The indices are calculated from consumer prices indices as at 30 June of each year. For example, 2018/19 data are multiplied by 1.090 to convert to 2019/20 prices, because the consumer price inflation between 30 June 2018 and 30 June 2019 was 9.0%.
TABLE 3 Inflation indices used to adjust to 2014/15 prices
11/12 12/13 13/14 14/15 15/16 16/17 17/18 18/19 Annual inflation 22.7% 32.5% 25.7% 18.8% 18.2% 11.3% 8.6% 9.0% Adjustment factor 2.044 1.666 1.257 1.000 0.842 0.712 0.640 0.589
Source: Consumer price data from the Reserve Bank of Malawi4.
4 The indices are calculated from consumer price indices as at 30 June of each year. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 4
1.3.3 Analysis of sector performance and equity
Progress in the WASH sector is assessed through the level of access to WASH services, and the quality and functionality of those services. Utility performance is a distinct component, which is measured by indicators reported to MoAIWD and reported in sector performance reports. Separately, equity analyses focus on the degree to which progress in WASH has been pro-poor, and the allocation of budget in relation to need and location. Table 4 summaries the data sources used in the analysis of sector performance.
TABLE 4 Assessing sector performance
Performance Details of analysis Data sources area
Access • Analysis of access • Secondary nationally to basic to basic services by representative surveys services district and nationally, (Demographic and over time. Health Surveys (DHS) and Multiple Indicator Cluster Surveys (MICS), and the census.
Service • Analysis of • Secondary data on functionality functionality rates sector performance and quality across districts and in from MoAIWD. relation to operation and maintenance • Sector performance (O&M) expenditure. reports (especially Analysis of service the 2016 report). levels. Data currently being collected on water point mapping.
Utility • Analysis of • Data obtained from performance performance the water boards. Data in reference to from MoAIWD. key International Benchmarking Network for Water and Sanitation Utilities (IBNET) areas. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 5 PUBLIC EXPENDITURE REVIEW © UNICEF/2015/Chikondi
2. NATIONAL CONTEXT 2.1 Macro-economic situation
Malawi’s GDP per capita remains low, at $389 in 2018, Low GDP growth in 2015–2016 was attributed, in part, to a and its poverty incidence, as well as some of its human persistent two-year drought10. The 2016 drought is estimated development indices are among the worst in sub-Saharan to have left over 40% of the population (~6.5 million people) Africa. The proportion of the population living below the poverty facing food insecurity11. In addition to drought, Malawi has also line ($1.90 per day) was 69.4% in 2018 (World Bank, 2018), and experienced shocks related to flooding, notably heavy flooding Malawi ranks 172 of 187 countries on the Human Development in 2015 and Cyclone Idai in 2019. For example, the 2015 floods Index5. Malawi ranks also 172 in gender equality6 reflecting affected over a million people, displaced 230,000, and caused high gender-based violence, frequent early marriages, and poor damage and loss totalling over $335 million, with the cost of maternal health. The 2018 census reported a population of 17.5 disaster recovery estimated at $494 million (GoM, 2015). million. Population growth between 2008 and 2018 averaged 2.9%. The majority of the population (84%) lives in rural areas. In 2018 inflation eased to single-digits, after years of double- Malawi’s population is youthful: 51% of the population is under digits with a peak of around 30% in 2013. The decline in 18, and the median age is 17. However, the latest census shows inflation is attributed to the stabilisation in food prices, a prudent early signs of a slowing birth rate and a demographic transition, macro-economic policy (IMF, 2018), and the continued stability with a narrowing base in the 0–4 years’ cohort. of the Malawi Kwacha (World Bank, 2018). Key inflationary pressures include food prices, and rising water and electricity Malawi’s GDP growth rate averaged 4.7% between 2017 and tariffs12. 2019 – 5.2% (2017), 4.0% (2018) and 5.0% (2019)7. GDP growth is expected to increase gradually to 6% in the medium term8. Changes in GDP growth are largely associated with shifts in the agricultural sector, which accounts for over 72% of employment9.
5 http://hdr.undp.org/en/countries/profiles/MWI 10 These droughts were associated with El Nino and were also accompanied by flooding. 6 http://hdr.undp.org/en/data The droughts were the worst in 35 years and resulted in a food crisis following two failed harvest due to lack of rains. 7 2019 Annual Economic Report 11 Estimates by Oxfam, www.oxfam.org.uk/what-we-do/emergency-response/mala- 8 ‘IMF DataMapper’ https://www.imf.org/external/datamapper [accessed September 2019], wi-food-crisis [accessed October 2019] differing slightly from Malawi government data 12 Ibid. 9 As at 2018. Source: World Bank DataBank https://databank.worldbank.org [accessed October 2019] MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 6
IGURE P
6 30
5 25
4 20
3 15
Real GDP growth (%) GDP growth Real 2 10 Inflation, consumer prices (%)
1 5
0 0 2013 2014 2015 2016 2017 2018 2019 2013 2014 2015 2016 2017 2018 2019
Malawi SADC sub-Saharan Africa Malawi SADC sub-Saharan Africa
0
-5
-10
-15
-20 Current account balance (% of GDP) Current
-25
-30
2013 2014 2015 2016 2017 2018 2019
S Authors’ analysis using International Monetary Fund (IMF) data, www.imf.org/external/datamapper [accessed September 2019], SSA sub-Saharan Africa, SADC Southern African Development Community Malawi sub-Saharan Africa WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 7 PUBLIC EXPENDITURE REVIEW
The current account deficit has reduced in recent years, consumption increased substantially as compared to the bottom albeit higher relative to regional peers. While exports have 10%. Income inequality (Figure 3) has also continued to worsen, grown steadily in absolute terms the export base is narrow and with the top 10% of earners accounting for over a 58% share dependant on a few key crops: tobacco, sugar, coffee, and tea of income in 2017, and the bottom 50% of earners accounting alone account for almost 90% of export revenues13. This narrow for only a 12% share of all income. The structure of inequality is agricultural export base means that export revenues are prone to heavily rooted in an urban/rural divide. shocks either related to production or external demand. GDP growth, unaccompanied by reductions in inequality, is Despite the economy’s reliance on agriculture, the unlikely to contribute significantly to poverty reduction15. proportion of total GDP represented by agriculture has been Furthermore, growth focused on increasing employment in low- continuously declining. The service sector has increasingly productivity sectors (such as agriculture or informal sectors) is in come to account for a larger share of GDP. Growth in services fact likely to compound inequalities16. is largely related to the tourism, transport, telecommunications, retail, and banking sectors (NSO, 2018). Looking forward, GDP 2.2 Government revenues and expenditure growth remains heavily tied to performance in the agricultural Malawi’s fiscal position worsened in FY2017/18 due to sector. Key risks to growth include shocks associated with revenue shortfalls and expenditure overruns. The deterioration extreme weather and pests (notably the Fall Armyworm of the position was, in part, associated with paying arrears, infestation). Beyond the agricultural sector and the government’s which dated back to FY2012/13 and the bailout of the Agricultural fiscal position, the sharp decline in capital inflow (largely from Development and Marketing Corporation. This fiscal expansion external aid) is another contributing risk area. was largely financed by domestic borrowing. Nevertheless, the IMF projects that the fiscal position will improve substantially in Historically, GDP growth has not been pro-poor: during the coming years. Malawi’s central government debt stands at the period from 2004 through 2011, GDP annual growth 62% of GDP, which indicates that Malawi is at ‘moderate risk’ of averaged over 6%. This growth was accompanied by a external debt distress (IMF, 2017), though the overall risk of debt worsening of the Gini coefficient, which increased from 0.399 to distress is seen to be higher as much of the recent expansion 0.455. This recently declined slightly to 0.447, in 201614. Over the has been funded by domestic debt (World Bank, 2018). Over the same period to 2011, the richest 10% of the population’s share of
15 Mussa, 2017; Oxfam, 2015 13 UNICEF (2018), based on IMF and OECD data. 16 African Development Bank (AfDB) (2019) – see page 73 and technical note 4 on page 99. 14 These are the most recent estimates by the World Bank.
IGURE C GDP IGURE E I
100 100
80 80
60 60
40
40 (%) Percentage Value added (% of GDP) Value
20 20
0 0 2004 2006 2008 2010 2012 2014 2016 2004 2007 2010 2013 2016
Services Manufacturing Industry Bottom 50% Middle 40% Top 10% Agriculture, Forestry and Fishing
S World Inequality Database. S Authors’ analysis based on World Bank data *Share of pre-tax income by group MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 8
last five years interest payments as a proportion of government expenditure have remained relatively constant, at just under 20%17.
From 2011/12 up to 2018/19 the real annual growth of domestic revenues averaged 4.4%. The trend is shown in Figure 4. Expressed as a proportion of GDP, domestic revenues (which exclude external grants) increased from 14.8% in 2011/12, through a peak of 21.6% in 2016/17, to about 20% in the last two years. The average over the whole 8-year period was 19.9%18 of GDP – a figure that is above the sub-Saharan average of 17.1%19. The growth in revenues as a % of GDP has been attributed to improved collection performance by the Malawi Revenue Authority (UNICEF, 2018).
Real growth in revenues between 2013/14 and 2018/19 has averaged only 1.3% per annum, due to a set of factors that constrained fiscal space over the period, and which will continue to do so in the coming years. Specifically, the factors include the suspension of budget support from 2014; a growing population, which places pressure on services; the need to address the fiscal deficit in coming years; and the need to service the domestic debt that, in part, financed the recent expansion.
17 GoM Financial Statement (Budget Document 3) for each year. 18 19.9% is the average of the dotted line in Figure 4 19 Data are from the IMF’s Africa Regional Economic Outlook database, www.imf.org/ external/datamapper/datasets/AFRREO [accessed October 2019]. © UNICEF/2009/Pirozzi
IGURE G W
1200 30%
1000 25%
800 20%
600 15% %, GDP MWK, billion
400 10%
200 5%
0 0% 11-12 12-13 13-14 14-15 15-16 16-17 17-18 18-19
Domestic revenue (real) - left-hand axis Domestic revenue (nominal) - left-hand axis Domestic revenue as % GDP - right-hand axis
S Authors’ analysis – Actual/provisional revenue figures from GoM Financial Statement (Budget Document 3) for each year; GDP figures from GoM Annual Economic Report
20 2014/15 is used in this report as the base year for the presentation of real prices in MWK. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 9 PUBLIC EXPENDITURE REVIEW
IGURE G
2018-19
2017-18
2016-17
2015-16
2014-15
0% 20% 40% 60% 80% 100%
ORT etc. PE Dev Pt 2 Interest
S Actual/provisional expenditure figures from GoM Financial Statement (Budget Document 3) for each year.
Recurrent expenditures and interest payments constitute a TABLE 5 Description of GoM budget elements large proportion of Government expenditures. Development expenditures funded by GoM are only a small proportion of the total expenditures21. Figure 5 shows key elements of the GoM Budget elements Description budget and Table 5 describes each element. Since 2014/15, ORT PE Salaries and related costs. expenditures (including subventions and pensions) have dropped Other recurrent expenditures covering all ORT purchases of goods and services, travel and as a proportion of total GoM-funded expenditures22 and personal allowances, fuel, etc. emoluments (PE) have shown only a small increase. Without Domestically-financed projects’ non-recurrent adjustment for inflation, PE has an average annual increase of expenditures. Within local authorities this is 19.3%, whereas ORT has grown by an average of only 15.1% further sub-divided into the DDF, a borehole/ per annum23. There is a sharp increase in Development Part 2 Part II water structures fund (separated from the DDF since 2016/17), and the Constituency expenditure (GoM-financed capital expenditure), which shows Development Fund (CDF), which is an annual average growth of 39.3%. However, this proportion of allocation for each MP’s constituency. Dev. the total (reaching 8.2% of total GoM-financed expenditures in Donor-financed projects/ non-recurrent expenditures. Part I donor-financed projects 2018/19) is still very low compared to need. Part I include those that use some elements of GoM financial systems. 21 Most development expenditure in Malawi is funded from external (donor) sources (not included in Figure 5). Other donor-financed projects which are Off- 22 Excluding donor-funded Development Part 1 expenditures. included in the GoM budget document but budget 23 Authors’ analysis of GoM Financial Statement (Budget Document 3) for each year not within the overall GoM budget total. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 10
2.3 Government budget credibility experience the GoM-wide ORT revised budget was 100.7% of the original budget and the amount funded by Treasury and spent by MDAs There is high credibility of the overall recurrent budget was 100.1% of the revised budget, a different picture emerges but consistently low credibility of the GoM-financed for local authorities. The overall revised ORT budget of local development budget. Figure 6 below shows three points for authorities was 93.8% of the original budget and funding by each element of GoM expenditure (excluding interest): the first Treasury was 96.3% of the revised budget25.Within this overall is the revised budget as a proportion of the original budget; the result, some sectors like health and education received 100% of second is the actual execution as a proportion of the revised the original budget, while others (including water) had large cuts. budget; and the third is actual execution as a proportion of the original budget, which is a combination of the first two. Figure 2.4 External support 6 shows that the average execution of PE and ORT (the two elements of recurrent expenditure) has been close to 100% The contribution of external resources (aid) to total of the GoM budget. However, the picture is different for GoM- expenditure is substantial. Malawi remains highly dependent financed development expenditure, for which execution has on donor contributions which fund much of the development averaged 60.7% of the original budget24. expenditure in the country. Between FY2014/15 and FY2018/19 external resources were consistently between 80% and 90% of all development expenditures (UNICEF, 2018). IGURE G The composition of external aid to Malawi changed after the suspension of most budget support from 2014. This is evident from the trend of ‘on-budget’ external support (called grants 120% within budget documents) shown in Figure 7. In inflation-adjusted prices, grants in the two years before the 2014 suspension of
100% budget support averaged MWK190 billion, but they averaged only MWK84 billion in the five years thereafter – a drop of 56%26. The cut in budget support has had a severe effect on fiscal space.
80% 25 Funding by Treasury is used as a proxy for actual spending as typically 99.9% of district ORT funding is spent. 26 In Figure 7, 12-13 is much higher than 11-12 because of the inclusion in 12-13 of delayed disbursements from 11-12 60% IGURE G W 40%
300 20%
250 0% PE ORT etc Dev Pt2
200 Revised vs original Actual vs revised Actual vs original
150 S Authors’ analysis of GoM budget documents MWK, billion
100 The experience of PE budget execution at individual MDAs is similar to that of GoM-wide figures shown above. In general, GoM funds salaries in line with approved budgets, for example 50 actual vs original averaged 99.8% in the four years to 2018/19, ranging from 98.9% up to 104.5%. 0 11-12 12-13 13-14 14-15 15-16 16-17 17-18 18-19 The experience of budget execution of the ORT budget at individual MDAs is less straightforward that that of PE. To Grants (real) Grants (nominal) illustrate this, the overall budget and funding of the sub-national local authorities was examined for the year 2018-19. Whereas S Authors’ analysis – Actual/provisional revenue figures from GoM Financial Statement (Budget Document 3) for each year 24 The Development Part 2 execution rate for individual years during 2014/15 through to 2018/19 ranges from 41.9% up to 74.5%. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 11 PUBLIC EXPENDITURE REVIEW
Figure 8 highlights that overall donor funding increased following the reduction in 2013/14. Funds that had been provided as budget support were diverted to other delivery channels, such as project-type interventions.
Since 2014 the composition of aid has changed, with an increasing proportion of aid channelled to multilateral institutions or NGOs, and for projects and pooled funds rather than budget support. Since 2014 the volume of aid delivered through the public sector has gradually been increasing, though as a proportion of all aid it has not reached the levels before 2014. The public sector received 47% of all aid in 2012; this decreased to 27% in 2016, then increased to 39% in 2017 27.
27 In parallel with these changes, there has also been an increase in the proportion of total
external finance in the forms of loans as opposed to grants. This is illustrated later in the © UNICEF/2015/Chikondi report, in Figure 24.
IGURE ODA USD ,
800 800
700 700
600 600
500 500
400 400 USD, millions USD, millions USD, 300 300
200 200
100 100
0 0 2011 2012 2013 2014 2015 2016 2017 2011 2012 2013 2014 2015 2016 2017
Budget support Core contributions and pooled Public support NGOs and Civil Society programmes and funds Multilateral Organisations Project-type interventions Agriculture, Forestry and Fishing Teaching or research insitutions and think-tanks Private Sector Institutions Other
S Authors’ analysis based on OECD-DAC CRS data https://stats.oecd.org/Index.aspx DataSetCode CRS1 [accessed October 2019] *Other includes expenditure related to: scholarships, debt relief, admin costs, and other donor expense expenditures.
2.5 Public Finance Management (PFM) in Malawi budget consolidation take place in early May. Parliamentary approval is usually given in June. A mid-year revised budget 2.5.1 Overview of budget process revision is presented to Parliament for approval around January. The national budget runs from 1 July to 30 June each year. Budget preparation starts in January/February with the District-level budgeting follows a similar process. The budget circulation of the budget guidelines and indicative medium- cycle at districts (local authorities) follows a similar process, with term expenditure framework (MTEF) ceilings. MDAs are district-wide ceilings set at a national level for each sector, while then expected to submit their line-by-line budgets in April and the NLGFC has a role in developing and applying the formulae budget hearings are held, after which the final MTEF ceilings used to calculate the budget allocation of sectoral totals between are circulated. Final budget submissions from MDAs and the each authority. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 12
2.5.2 Expenditure controls The effectiveness of budget setting is constrained by late adjustments before the final version is presented to Accounting is carried out by the ‘accounting common Parliament. Treasury starts the annual budget process with service’, under the oversight of the Accountant General, who estimated budget ceilings for each MDA, but the final ceilings allocates staff to each MDA. These officers are expected to received from the centre in about April are almost always lower. apply formal accounting and control procedures, as set out in the Late adjustments are required but are often made without the ‘desk instructions’. same depth of participation as the original budget, so the final budget may not be ‘owned’ by stakeholders. The IFMIS is the accounting software that facilitates budgetary control of ORT and development budgets. The Monthly funding of the budget by Treasury to MDAs often Accountant General oversees its operation at the national level, differs from the month-by-month forecast agreed at the time with terminals for IFMIS access and transaction entry distributed of the original budget. Funding is usually skewed towards the around MDAs. IFMIS serves as a control mechanism to ensure year end, creating pressure to spend at that time and associated that ORT and development payments do not exceed the line-by-line miscoding risks. respective budget lines.
There is evidence that the intended line-by-line budgetary A different version of the IFMIS operates at local authorities, control of IFMIS over ORT and development does not work. though coding is largely consistent. The NLGFC has oversight This is because, for example, where an annual budget allocation over PFM at local authorities and accounting officers at that is exhausted so that a payment cannot be made against that level recently ceased to be part of the common service due budget code (because of IFMIS controls), the payment is coded to progress in decentralisation. There are also separate local to a budget line that is not yet exhausted. MDAs are often authority accounting guidelines which cover IFMIS operation, able to spend between 95 and 100% of their total funding for and also local revenue collection (e.g. property rates and market the year even though there has been no formal reallocation of fees), as well as controls over the use of this revenue. funds between budget lines within a MDA. As a result, actual expenditure often precisely matches the budget for most budget 2.5.3 Performance of the PFM system lines. This also means that, at MDA level, many decisions on The 2018 Public Expenditure and Financial Accountability allocation of funding to priorities are taken on a month-by-month (PEFA) assessment provides an up-to-date picture of PFM basis, once monthly funding is received, but without reference performance, as well as changes since the previous PEFA in to the annual budget. At local authorities, the same line-by- 2011. Relevant conclusions of the 2018 assessment include the line budgetary control challenges are evident. Although local following: authorities do not have authority to move ORT bank account funds between sectors (or to district HQ budget lines), this • Substantial off-budget donor operations impair GoM’s ability occasionally happens in practice. to have an overview of total expenditures, although GoM oversight of this has improved since 2011. Inadequate coding within the IFMIS limits control over development expenditure. Coding within the IFMIS of • In aggregate, approved budgets tend to be a good indicator Development Part 2 (GoM-funded) expenditure is not done in of expenditure performance; however, development such a way that it is easy to track expenditure against budget expenditure regularly underperforms. per project. In addition, while the budgets of Development Part • Programme-based budgeting (PBB), introduced in 2011, is 1 (donor-funded and ‘on-budget’) projects are recorded in the not yet fully functioning, since actual spending is not yet IFMIS, the expenditures of almost all projects are not recorded being compared with actual programme outputs. within the IFMIS during implementation.
• The MTEF process does not add much value at sector levels Budget information on donor-funded projects is incomplete. and below, even though it has improved a little since 2011. In GoM’s 2019/20 budget documents, Development Part 1 • Expenditure reporting and overall control of balances is (donor) project budgets for the year total MWK306 billion. Part impaired by the large value of expenditures for goods and 1 projects comprise those that are ‘directly managed’ by GoM, services received but not formally recorded until payment such as when expenditure is incurred through a GoM-signed is actually made (referred to as arrears), which results in bank account that is funded by the donor. The budget document fiduciary as well as balance control risks. The PEFA score also lists ‘off-budget’ donor-funded projects totalling MWK153 shows some decline since 2011. billion in 2019/20. These projects are not fully managed by GoM but are reported by donors to GoM during the budget process. • Procurement is still a high-risk area as regards value for In addition, an unquantified number of donor-funded projects are money in public expenditure, and the overall effectiveness not recorded within the budget document at all. of internal controls has declined since 2011. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 13 PUBLIC EXPENDITURE REVIEW
The effectiveness of PFM control over salaries at local authorities is constrained. The control of sector salaries at local authorities is constrained because of decentralisation, and the related controls are incomplete. While sector salary budgets and administration were decentralised from 2017/18, the coding of such salaries within local authority Votes had not been recorded within the IFMIS by sector (nor by PBB), which constrains the capacity of local authorities to manage salaries. In addition, the management of staff, especially ‘hire and fire’ decisions, is not yet fully in the control of local authorities. © UNICEF/2020/Banda MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 14 © UNICEF/2015/Chikondi
3. WASH SERVICE TABLE 6 MDA responsibilities for water and sanitation
DELIVERY IN MALAWI Policy Details
National Decen- • MoAIWD to supply safe water This section discusses the WASH service delivery in Malawi. tralisation Policy The overall national policy orientation is articulated through the 1998 • MoHP to coordinate and manage environmental sanitation second and third Malawi Growth and Development Strategies (MGDS) II and III. While water and sanitation feature as priority • MoLGRD to provide oversight of WASH services through Health and Services areas in each of the MGDSs, however the MGDSs do not set Committee clear, measurable targets for WASH (or any other social sector), MGDS III Under Priority 6, clarifies roles of MoAIWD and and as such are not well suited to assessing progress against (2017–2022) MoHP: policy objectives. • MoAIWD is to supply safe water and manage water sources
The legislation underpinning the sector establishes clear • MoHP promotion of sanitation and hygiene, roles and responsibilities. The Waterworks Act (1995) created enforcement of sanitation laws the water boards and defines their responsibilities with regards National Environ- Gives roles and responsibility of MoAIWD and to urban service delivery. The Local Government Act (1998) mental Health MoHP as: Policy 2018 decentralised some WASH sector functions to the district • MoAIWD – supply of safe water councils. Other key pieces of legislation include the Environmental • MoHP – promotion of sanitation and hygiene, Management Act 1998 and the Water Resources Act 1969 conducting water quality surveillance, and enforcement of sanitation and hygiene laws and 2013. The Public Health Act 1948 [last amended 1975] (Public Health Act CAP 34:01 section 59-114) regulates sanitation and hygiene, including water quality. Table National • Gives leadership of sanitation and hygiene 25 (in Annex B) outlines the key legislation in the WASH sector. Sanitation and to MoHP, in line with Public Health Act CAP Together with the policy documents this provides the framework Hygiene Strategy 34:01, National Decentralisation Policy 1995, (2018–2024) and MGDS III Priority Area 6 for understanding the de jure institutional arrangements. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 15 PUBLIC EXPENDITURE REVIEW
Service delivery functions are performed by the District raised as two key issues underlying this. In the sanitation sub- Councils and the Water Boards. Both of these have the sector, the quality of latrines is one of the most prominent policy responsibility for the O&M of water systems within their concerns. Across the whole sector the lack of regulatory powers jurisdiction, with water boards focused on urban areas. The and a weak evidence base for reviewing policy are raised as WUAs and Water Point Committees also perform delegated sector-wide challenges. O&M functions for water systems on behalf of either the District Council or Water Boards. MoAIWD adopted the concept of the BOX 1 Key Sector policy and service delivery issues WUA to ‘empower the communities to own and manage the piped water supply systems in the market centres and rural In 2015, at the Share Symposium meeting, MoAIWD outlined areas on their own with minimum support from outside’. These several WASH sector challenges and constraints including: community-based WUAs are intended to act as ‘mini water i. ‘Very minimal progress in moving up the sanitation ladder. boards’ – though they do not receive any financial support from ii. Capacity and human resource issues. GoM sources and are expected to collect the funds for running iii. Inadequate evidence based formative research to support the systems from the community they serve. Table 28 (in policy formulation. iv. Low functionality rate of water systems especially in Annex B) provides a more thorough mapping of the institutional rural piped water supply systems and boreholes, which is framework as described above. depriving rural communities’ access to safe water supply. v. The proliferation of non-Village-Level Operation and Maintenance (VLOM) hand pump technologies especially The National Water Policy 2005 and the National Sanitation on shallow wells being implemented by some partners. Policy 2006 provide a broad orientation on policy. Together vi. Inadequate and outdated legal instrument for regulation of with the legislation they clarify institutional responsibilities and the WASH [water] sub-sector’ service delivery functions. However, these two sector policies are out of date with respect to subsequent legislation (Water The 2017/18 sector performance report provides insight into Resources Act 2013); the specific objectives/ activities outlined the current key policy issues in the sector. In the rural water in the policies end at 2010/11; and the WASH progress since 2011 sub-sector functionality remains a critical issue. Constraints is not acknowledged. The sector strategies published since the include: inadequate funding and staffing at the district level; National Water Policy 2005 and the National Sanitation Policy infrastructure being developed without the involvement of the 2006 provide a further basis on which to assess the degree District Water Office or Water Point Committees; and a shortage to which public expenditure is aligned with policy. The relevant of spare parts and area mechanics. In the urban water sub-sector, strategies are numerous, partly as the PER timeframe crosses a focus is placed on reducing non-revenue water (NRW), and two strategic planning periods (2011–16 and 2017–22). Table 27 identifying sources of financing for large-scale investments in (in Annex B) provides an overview of the relevant strategies. infrastructure. In the sanitation sub-sector, a critical policy issue Table 26 (in Annex B) provides an overview of the key policy is the move from the MDGs to the SDGs, and the need to agree documents in the WASH sector. an approach to achieving the SDGs – specifically, agreeing the indicators to be used to measure progress, as well as identifying Box 1 outlines the key sector policy issues identified at the strategies that can effectively raise service levels and improve start of the PER period. In the water sub-sector functionality is the quality of latrines and services. raised as a critical sector challenge, with capacity constraints and the proliferation of non-village-level O&M (VLOM) technologies MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 16 © UNICEF/2015/Chikondi
4. WASH FINANCING IGURE C G WASH FINDINGS SSA GDP USD There are three main sources of WASH financing in Malawi: (i) domestic revenue (from tax and non-tax sources); (ii) external 0.12% 12 financing (ODA and private sources); and (iii) expenditures by households on water and soap. Funding from each source is considered in turn below, with financing sources in Malawi 0.10% 10 compared to other sub-Saharan African countries. To allow for a standard comparison, the PER used data from the 2017 0.8% 8 UN-Water Global Analysis and Assessment of Sanitation and Drinking-Water (GLAAS). 0.6% 6 % of GDP
4.1 Government financing of WASH Capita USD Per 0.4% 4 Government financing of WASH services in Malawi is lower compared to other SSA countries. Recent data on government 0.2% 2 WASH financing in SSA (UN-Water Global Analysis and Assessment of Sanitation and Drinking-Water (GLAAS), 2017) enable a comparison of government WASH financing relative to 0% 0 South Lesotho Mali Ghana Kenya Zambia GDP and in per capita terms. In relation to GDP, Government Africa WASH financing in Malawi (0.08%) is significantly less than in Zambia (0.15%), Kenya (0.16%), Ghana (0.19%), and Mali % of GDP Per Capita USD (0.31%). In per capita terms, Government WASH financing in Malawi (U$0.33) is also very low compared to Zambia (US$2.0), S Authors’ analysis of GoM budget documents Kenya (US$2.2), Ghana (US$2.6), (US$2.4), Mali (US$2.4), Lesotho (US$5.3) and South Africa (US$59). WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 17 PUBLIC EXPENDITURE REVIEW
Despite limited fiscal space, the GoM has increased its The low financing of WASH by the GoM was confirmed funding to the WASH sector since 2017/18, largely linked to by district WASH officers. All DWDOs and DEHOs reported the introduction of the Borehole Fund. Over the five years of inadequate GoM funding in their responses to the PER survey the PER period, GoM funding of the sector has averaged 0.39% (to which responses were received from all districts). Limited of total government expenditure (TGE). There was a notable Government funding was highlighted as a major source of WASH increase from 2017/18, when the Borehole Fund was introduced. performance challenges. The average in the three years before the introduction was 0.32% and was then 0.49% in the two years thereafter.
IGURE G WASH , TGE GDP, W
0.6% 250
0.5% 208
0.4% 166
0.3% 124 MWK
0.2% 82 Proportion of TGE or GDP of Proportion
0.1% 40
0 0 Annual Averages
As a proportion of TGE - left-hand aixs As a proportion of GDP - left-hand axis Per capita (real) MWK - right-hand axis
S Authors’ analysis of TGE and GDP from GoM budget documents and GoM WASH data © UNICEF/2015/Chikondi MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 18
4.2 External financing for WASH IGURE R External financing for the WASH sector in Malawi compares WASH SSA well to other SSA countries (Figure 11). Malawi’s external financing, expressed as a percentage of GDP, is the second highest amongst six countries with available data on the 2017 GLAAS database. However, per capita external funding remains the lowest28. Kenya The ratio of Malawi’s external to government financing is much higher than for each of the same five comparison Zambia countries. This is despite Malawi having lower per capita funding from external sources. The significance of external funding in Malawi is evident in Figure 12, which shows that the ratio of Lesotho external to government financing is 8.8 – much higher than that of Kenya (2.9) and Zambia (2.0), Lesotho (1.9), Mali (1.3), and Mali Ghana (1.2). Malawi’s reliance on external funding presents a key risk to WASH sector progress as such funding may fluctuate from year to year. Ghana
0 2 4 6 8 10 4.3 WASH financing by households Households in Malawi are contributing more to WASH financing when compared to other SSA countries, based on the 2017 GLAAS data. Figure 13 shows that households in S Authors’ analysis of data from GLAAS 2017 report, specifically Figures 8 Malawi spend more as a percentage of GDP than five of the six and 9 in that report, plus authors’ analysis of OECD-DAC CRS data. comparator countries. In per capita terms, households in Malawi also spend more than in Zambia, Mali, Kenya, and Lesotho as shown in Figure 13.
28 South Africa is not included as (according to the GLAAS report) it receives no external financing for the WASH sector. However, it does have substantial repayable finance that is non-ODA. IGURE C WASH IGURE C S A GDP WASH S A USD GDP USD 0.30% 80 0.010 12 70 0.25% 10 0.008 60
0.20% 8 50 0.006 0.15% 40 6 % of GDP Per Capita USD Per
% of GDP 30
0.004 Capita USD Per 0.10% 4 20
0.5% 0.002 2 10
0% 0 Ghana South Zambia Mali Kenya Lesotho 0.000 0 Ghana Zambia Mali Kenya Lesotho Africa
% of GDP Per Capita USD % of GDP Per Capita USD
S Authors’ analysis of data from GLAAS 2017 report, specifically Figures 8 S Authors’ analysis of data from GLAAS 2017 report, specifically Figures 8 and 9 in that report 30 , plus authors’ analysis of the Malawi IHSs III and IV. and 9 in that report, plus authors’ analysis of OECD-DAC CRS data. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 19 PUBLIC EXPENDITURE REVIEW
Compared to other funding sources, the financial different countries linked to measurement issues. For example, contribution by households in Malawi (71%) is higher than the calculation of households’ contribution in Malawi includes five of the six selected SSA comparators, except Ghana as expenditure on items such as soap but not on construction of shown in Figure 14. However, there may be inconsistencies toilets. with regards to the comparison of household expenditures in
IGURE C WASH , ,
Ghana
South Africa
Zambia
Mali
Kenya
Lesotho
0% 20% 40% 60% 80% 100%
Households External Government
S Authors’ analysis of data from GLAAS 2017 report, specifically Figures 8 and 9 in that report, plus Malawi data from Section 5 below. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 20 © UNICEF/2015/Chikondi
5. EXPENDITURE IGURE G WASH FINDINGS W ,
This section discusses spending patterns in the WASH 4,000 sector in Malawi over a five-year period from 2014/15 to
2018/19. Among others, the section covers: government WASH 3,500 expenditure; donor expenditures (through ODA and NGOs); expenditures by commercial organisations, institutions and 3,000 households which is incurred through water boards, household expenditures; expenditures in emergencies and expenditures by 2,500 sub-sector (water and sanitation, urban and rural).
2,000 5.1 Government WASH Expenditures MWK, millions 5.1.1 Overall Government WASH Expenditures 1,500
Aggregate government expenditure on WASH notably 1,000 increased from 2017/18, largely linked to the introduction of the Borehole Fund. With regards to recurrent spending, 500 expenditures on wages and salaries, commonly referred to as personnel emoluments (PE), and other recurrent transactions 0 (ORT), were fairly steady over the five-year period as shown in 2014-15 2015-16 2016-17 2017-18 2018-19 Figure 15. PE overall ORT overall Dev overall Emergency Government expenditure on water is nearly twice that on sanitation as shown in Figure 16. Over the five-year period, the S Authors’ analysis of GoM budget documents proportion of Government expenditure on water averaged 65% compared to 35% on sanitation and hygiene. Detailed analysis of expenditure in each sub-sector are provided in sections 5.1.2 and 5.1.3. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 21 PUBLIC EXPENDITURE REVIEW
TABLE 7 Water sector expenditure – economic classification IGURE G WASH W , (MWK million – 2014/15 prices) 5-year 14/15 15/16 16/17 17/18 18/19 propor- 5000 tions DISTRICTS PE 153 148 147 157 177 9.0%
4000 ORT 81 96 96 108 69 5.1% Dev 83 305 486 1,778 1,551 48.1% CITIES Dev - - - - 13 0.1% 3000 MoAIWD PE 38 42 41 59 62 2.8% ORT 16 17 19 30 31 1.3%
MWK, millions 2000 Dev (part II) 798 440 413 893 365 33.3% Emergency 22 - - - - 0.3% TOTAL GoM Total water 1,191 1,048 1,202 3,026 2,269 100.0% 1000 Sources: Authors’ analysis of: IFMIS data, Treasury reports, and district reports to PER team on staffing levels – details are in Box 3 and Box 4 in Annex J.
0 5.1.3 Sanitation and hygiene sub-sector expenditure 2014-15 2015-16 2016-17 2017-18 2018-19 5-years ave. Similar to water, Government spending on sanitation and S&H Water hygiene is comprised of central and local level expenditure. Total At central level, Government spending on S&H expenditures is channelled via the Environment Health Unit under the MoHP S Authors’ analysis of GoM data – details are in Box 3 and Box 4 in Annex J (for PE and ORT). At local level, expenditures on S&H (for PE and ORT) are channelled via the District Health Office (DHO). It 5.1.2 Government expenditure in the water sub-sector should be noted that the Government does not have a separate allocation to support S&H services at local level. Hence, S&H Government spending on water comprises of expenditure expenditure included in this report are estimates from the DHO’s at the central (via the MoAIWD) and local levels (via District budgets. There are other expenditure elements in City Councils, Councils). Within the MoAIWD, water expenditures are incurred mainly for PE. There is no separate GoM-funded development under the Water Supply Services, comprised of PE, ORT and expenditure on hygiene and sanitation. Similar with the water Development Part II. At local level, water expenditure consists sub-sector, emergency expenditures, through the DODMA, are of recurrent spending on PE and ORT as well as development often erratic. Detailed S&H expenditure analysis (by national and expenditure under the Borehole Fund, DDF and CDF. In cities, sub-national levels and economic classification) is provided in some Government-funded water development expenditures Figure 18 and Table 8. were identified but they have no staff allocated to water (no PE) nor any ORT allocated to water. There are erratic funds for Over 80% of Government expenditure on S&H is for salaries, expenditures on emergencies from the Government, through the especially at local level. District-level S&H expenditure Department of Disaster Management Affairs (DODMA). Figure constitute 68% of total S&H expenditure while spending 17 provides a detailed analysis of Government water expenditure on salaries for the MoHP level is around 11.7% of total S&H by national and sub-national levels and economic classification. expenditure The District S&H budget is spent on salaries for HSAs (currently totalling 8,479) and AEHOs/EHOs (currently at Government expenditures on water are largely for the 438). creation of new infrastructure. Over the five-year period, development expenditure accounted for 81% of total water. A Total Government expenditure on sanitation and hygiene larger portion of this was spend at local level (48%), compared to has barely changed in real terms. This reflects the fact that 33% at the central (MoAIWD) level. The spending pattern shifted most of the expenditure is for the salaries paid to frontline staff, substantially towards districts since the introduction of the which has not changed much in real terms since 2014/15 as Borehole Fund in 2017/18. Figure 17 highlights very low water shown in Figure 18 and Table 8. development expenditure at district level until the introduction of the DDF in 2015/16 and later on the Borehole Fund in 2017/18. At central level, water development expenditure exhibits a significant yet fluctuating trend (see Figure 17 and Table 7). MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 22
IGURE W W
3,500
3,000
2,500
2,000
1,500 MWK, millions
1,000
500
0 2014-15 2015-16 2016-17 2017-18 2018-19
PE in districts Water PE in MoAIWD Depts ORT in districts Water ORT in MoAIWD Dev in districts Water Dev in cities Dev part 2 in MoAIWD Emergency
S Authors’ analysis of: IFMIS data, Treasury reports, and district reports to PER team on staffing levels – details are in Box 3 and Box 4 in Annex J
IGURE S W
1,000
800
600
MWK, millions 400
200
0 2014-15 2015-16 2016-17 2017-18 2018-19
PE in districts Health PE in cities PE in MoHP Depts ORT in districts Health ORT in cities ORT in MoHP Dev in districts Health Dev part 2 in MoHP Emergency
S Authors’ analysis of: IFMIS data, Treasury reports, and district reports to PER team – details are in Box 3 and Box 4 in Annex J. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 23 PUBLIC EXPENDITURE REVIEW
TABLE 8 Sanitation and hygiene sub-sector expenditure – IGURE D ORT economic classification (MWK million – 2014/15 prices) W 5-year 14/15 15/16 16/17 17/18 18/19 propor- tions 200 DISTRICTS PE 627 606 601 644 726 69.7% ORT 94 80 69 69 70 8.3%
Dev 17 50 79 68 45 5.6% 150 CITIES PE 16 15 15 16 18 1.7% ORT 10 8 15 17 8 1.3% MoAIWD 100 PE 107 102 102 113 116 11.7%
ORT 7 6 6 6 5 0.6% MWK, millions Dev (part II) - - - - - 0.0% Emergency 46 - - - - 1.0% TOTAL GoM 50 Total 922 867 886 933 989 100.0%
Sources: Authors’ analysis of: IFMIS data, Treasury reports, and district reports to PER team – details are in Box 3 and Box 4 in Annex J.
0 5.1.4 WASH budget credibility 2014-15 2015-16 2016-17 2017-18 2018-19
Government has over the years, until 2018/19, generally honoured its recurrent budgetary commitments to the Approved budget (nominal) Revised budget (nominal) WASH sector. However, district water ORT funds29 were Funded budget (nominal) Funded budget (real) severely constrained in 2018/19. In 2018/19 only 62% of the S Authors’ analysis of Treasury funding reports. approved budget was actually funded as shown in Table 9. Compared to 2017/18, the real value of funding for 2018/19 was about 37% lower as shown in Figure 19 below and in Table 9. In The CDF and Borehole Fund are 100% funded: Development addition, over the 4-year period (2014/15 to 2017/18), the Treasury expenditure in the WASH sector at district level is incurred funded over 80% of the approved district water ORT budget. It is through the CDF, Borehole Fund, and DDF (see DDF analysis in worth mentioning that there are no utilisation issues at local level Table 10). Overall, the Government development budgets have as all funded budgets are fully utilized, as discussed in Section consistently shown low credibility. The CDF and Borehole Fund 2.3. Due to data limitations, similar analysis was not possible for are allocated to districts at a flat rate per constituency. The 100% other expenditure elements of the WASH sector. funding of the CDF and Borehole Fund budgets is largely linked to political pressures exerted by the Members of Parliament. The TABLE 9 ORT budget execution data for the water sector at utilisation of DDF funds (as shown in Table 10) varies from year districts (MWK million, nominal) to year, in line with the patter in Government-wide utilization of the development budget. 14/15 15/16 16/17 17/18 18/19 Water ORT bud. approved 96.0 120.2 150.0 187.5 196.9 TABLE 10 DDF budget allocation and execution (MWK Water ORT bud. million – 2014/15 prices) received 96.0 120.2 150.0 178.1 137.8 Water ORT funding 85.0 120.2 141.5 178.1 122.4 15/16 16/17 17/18 18/19 Water funding in 2014/15 prices 85.0 101.1 100.7 114.0 72.1 DDF approved 7,786 4,348 5,463 3,471 Revised vs original 100.0% 100.0% 100.0% 95.0% 70.0% DDF revised 7,786 4,348 3,205 1,388 Funding vs revised 88.6% 100.0% 94.3% 100.0% 88.8% Revised % of approved 100.0% 100.0% 58.7% 40.0% Funding vs original 88.6% 100.0% 94.3% 95.0% 62.2% DDF funded 2,461 4,266 3,191 1,388 Year-on-year increase change in Funded % of revised 31.6% 98.1% 99.6% 100.0% real funding 18.9% -0.4% 13.1% -36.7% Funded % of approved 31.6% 98.1% 58.4% 40.0%
Sources: Authors’ analysis of Treasury funding reports Sources: Authors’ analysis of Treasury funding reports 29 Note that Treasury funding is a proxy for actual expenditure, since typically between 95% and 100% of a MDA’s funding is actually spent once funded. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 24
5.2 Donor and NGO expenditures on WASH30 5.2.1 ODA expenditures
An analysis of OECD-DAC CRS data was conducted to assess the donor-financing landscape. Such an analysis provides a full picture of ODA flows to the WASH sector, beyond the on-budget funding. The period under review (2011–17) was selected as commitments made earlier in this period will have influenced results between 2014/15 and 2018/1931. A total of US$360 million (2016 constant prices) was coded in the CRS as WASH commitments over the period 2011-17. This is equivalent to 5.4% of all ODA commitments to Malawi. Figure 20 presents summary data on the key donors to the sector, while Annex C contains a list of the key externally funded projects in WASH.
Several important trends emerge in external funding to the WASH sector. First, most (78%) of WASH ODA comes from multilateral institutions. The World Bank (accounting for 54% of all ODA commitments to WASH) is the largest donor funding the WASH sector in Malawi. Second, four countries (the United States, Australia, Japan, and the United Kingdom) account for most of the bilateral ODA to the WASH sector.
The resources from official sources (ODA) only includes funding that meets the strict ODA criteria32. It includes development assistance from bilateral donor countries as well
30 For the purposes of this PER, government sources of externally-funded expenditures (donor and NGO) are not complete, not sufficiently granular, and/or not reliable. The limita- tions of the government’s budget are described in Section 2.4.3, and the government’s Aid Management Platform has other limitations.
31 2017 was the latest year of OECD-DAC CRS data available. © UNICEF/2015/Chikondi 32 www.oecd.org/dac/stats/What-is-ODA.pdf [accessed December 2019].
IGURE D WASH ODA USD
Private donors Bilateral Multilateral UNICE Bilateral - AUSTRALIA A RICAN DEVELOP ENT Bilateral - UNITED STATES BAN Bilateral - JAPAN
Bilateral - UNITED KINGDOM
Bilateral - OTHER
Bilateral - WORLD BANK
Multilateral - AFRICAN DEVELOPMENT BANK
Multilateral - EU INSTITUTIONS
Multilateral - OFID
Multilateral - BADEA
Multilateral - UNICEF Bilateral WORLD BAN Multilateral - UNDP
S Authors’ analysis of OECD-DAC CRS (rounded to the nearest million), https://stats.oecd.org/index.aspx DataSetCode CRS1 [accessed February 2019 *Other bilateral includes Iceland, Ireland, Canada, Belgium, France, Norway, Germany, Italy, Switzerland, and Spain.
N AfDB African Development Bank, BADEA Arab Bank for Economic Development in Africa, GEF Global Environment Facility, OFID OPEC Fund for International Development. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 25 PUBLIC EXPENDITURE REVIEW
as from multilateral institutions (e.g. the development banks and There is a shifting trend in the delivery of donor resources UN agencies). The ODA figures exclude funding which NGOs away from the public sector (Figure 23). At the start of raise from non-ODA sources (e.g. funds raised from the public 2013/14, there was a relatively even balance of bilateral funding by NGOs), which are discussed in Section 5.2.2. between the public sector and NGOs. This fell sharply between 2013 and 2017, largely corresponding with the suspension of The proportion of ODA provided to the WASH sector has budget support to Malawi. Similar trends in multilateral funding dropped since 2014 (Figure 21). After registering an impressive show movement away from the public sector since 2015. increase from 2011 until 2014, the proportion of disbursements to the WASH sector declined from 2015, reaching below 2011 Funding to the WASH sector is increasingly shifting to loan levels by 2017. Between 2013 and 2014, funding to the WASH financing vis-à-vis grants. This is demonstrated in Figure 24 sector constituted over 12% of all aid (ODA) disbursements which compares the commitments in the 4-year period to 2013 to Malawi. This proportion however fell down to around 4% with those in the subsequent 4-year period. between 2016 and 2017 – clearly highlighting a shift in donor funding to the WASH sector. This funding shift is largely linked As part of the analysis of donor expenditure the descriptions to the withdrawal of funding by many bilateral donors as well as of large donor-funded projects were reviewed. This mapping the end of grant-funded programmes focused on achieving the is contained in Annex C and underscores the trends seen in the MDGs. DAC data: namely, the shift towards donors funding public sector After registering impressive growth between 2009 and 2012, institutions over NGOs and multilateral institutions, and the end donor commitments (and disbursements) to WASH financing of large programmes funded by bilateral donors. exhibits a clearly sharp downward trend from 2012 to 2016 (Figure 22). As is usual, disbursements lag behind commitments and are less ‘lumpy’. The sudden jump in commitments in 2017 (not yet reflected in disbursements) is largely linked to a World Bank loan for the Lilongwe Water and Sanitation Project.
IGURE WASH IGURE C ODA WASH USD
15% 120
100 12%
80 9%
60
6% millions USD,
40
3% 20
0% 0 2011 2012 2013 2014 2015 2016 2017 2010 2011 2012 2013 2014 2015 2016 2017
Commitments Gross Disbursements
S OECD-DAC CRS data, https://stats.oecd.org/index- S OECD-DAC CRS data, https://stats.oecd.org/index.aspx - .aspx DataSetCode CRS1 [accessed August 2019]. DataSetCode CRS1 [accessed May 2019]. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 26
IGURE D NGO USD
60
50
40
30 USD, millions USD,
20
10
0 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 DAC
Multilateral Organisations NGOs & Civil Society Not reported Other Private Sector Institutions Public Sector Teaching/research insitution
S OECD-DAC CRS data, https://stats.oecd.org/index.aspx DataSetCode CRS1 [accessed May 2019].
5.2.2 Non-ODA expenditures by NGOs IGURE C There are other sources of NGO funding for the WASH USD sector, raised from private sources in donor countries, and
200 is not captured in official sources (ODA) in section 5.2.1. A 2018 NGO Expenditure Survey by the Water and Environmental Sanitation Network (WESNET) revealed that NGO expenditure (both ODA-financed and private sources of finance) to the tune
150 of MK14 billion in 2018. The report further highlighted that an anticipated 13% (MK1.83 billion) reduction in NGO expenditure NGOs between 2018 and 2019.
100 A total of five NGOs affiliated to WESNET account for over 60% of the 2018 NGO expenditure reported by WESNET. USD, millions USD, These are World Vision (21%), Water Aid (13%), ONSE (11%), Water for People (11%), and United Purpose (7%). Most of the
50 reported expenditure is for water supply (42% of expenditure) and S&H (21% of expenditure). In addition, about 78% of the reported NGO expenditure was targeted to rural areas.
0 This PER was able to estimate yearly non-ODA expenditure 2010 - 2013 2014 - 2017 by NGOs, based on the 2018 WESNET data. Data from the WESNET (2018) report was complemented by data obtained from ODA Grants ODA Loans Private Development Finance structured questionnaires sent to donors and NGOs. Despite being incomplete, the responses provided sufficient information S OECD-DAC CRS data, https://stats.oecd.org/index.aspx - to prepare reasonable estimates of total non-ODA expenditure. DataSetCode CRS1 [accessed May 2019]. This was possible through interpolation and extrapolation using WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 27 PUBLIC EXPENDITURE REVIEW
three data sources – ODA data, the WESNET survey and the calendar years and are usually available with a 2-year lag (up to questionnaires. As shown in Table 11 below, these non-ODA 2017 in this case). To align the calendar years to fiscal years, ODA external expenditures are substantial. For example, in 2018/19 disbursement data was extrapolated from 2017 (incorporating non-ODA expenditure was estimated at MWK4.9 billion, which commitments in 2017) to the first half of 2019. In this way, is almost the size of the Government’s total WASH expenditures aggregate external WASH expenditure was estimated for each in 2018/19. year of the fiscal years between 2014/15 and 2019/20 as shown in Figure 25. 5.2.3 Overall external expenditure for WASH New funding to the WASH sector is overwhelmingly directed Aggregate external WASH expenditure was calculated by towards the public sector, with aid in the form of loans. combining official ODA figures (disbursed)33 and non-ODA Furthermore, the large new donor commitments to the sector data. Noteworthy is that ODA data are reported based on (from the AfDB and World Bank) are predominantly channelled 33 ODA disbursement data is divided into public sector and non-public sector as in Figure 23
IGURE E WASH W ,
N R
40 30
35 25
30
20 25
20 15 MWK, billion MWK, billion 15 10
10
5 5
0 0 2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19
Public sector Non-public Public sector Non-public Non-ODA Non-ODA
TABLE 11 Externally funded WASH expenditure (MWK billion)
Donors and NGOs 14/15 15/16 16/17 17/18 18/19 Nominal MWK bn ODA Public sector 18.2 10.4 8.8 18.3 23.6 Non-public sector 9.5 16.0 20.0 18.1 14.7 Non-ODA NGO 3.2 5.3 6.7 6.0 4.9 Total 27.7 26.3 28.8 36.4 38.3 Real MWK billion 2014/15 prices ODA Public sector 18.2 8.7 6.3 11. 7 13.9 Non-public sector 6.4 9.0 9.5 7. 7 5.8 Non-ODA NGO 3.2 4.5 4.7 3.9 2.9 Total 27.7 22.2 20.5 23.3 22.6
Sources: OECD-DAC CRS data; WESNET survey information; donor/NGO questionnaire results MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 28
to the water boards and focused in urban areas. The result is 61 partners are funding projects in at least six districts. These that while there will be new donor funds entering the sector, are (number of districts in parenthesis): UNICEF (16); World most will be focused in the urban sub-sector. Several traditional Vision (16), Red Cross (10), Feed the Children (9), CADECOM (8), bilateral donors34 have unambiguously signalled that they are United Purpose (8), and ONSE (7). phasing out investments in WASH infrastructure delivery. This means there will be fewer grant sources for NGO-/multilateral- Malawi has long been considering introducing a Sector Wide implemented programmes. Approach (SWAp)35, in line with its commitment during the Sanitation and Water for All (SWA) Global Partnership Donors do not consistently and reliably report data on budget in 201436. The Water Sector Investment Plan (2012)37 also execution. Some ODA data is recorded in the IFMIS under the recommended the introduction of a SWAp in the WASH sector. Development Part I. However, expenditure by donors against Some of the institutional apparatuses associated with a SWAp these budget lines is not reliably recorded in the IFMIS, limiting (joint sector reviews, technical working groups, etc) operational the measurement of expenditure performance. The OECD-DAC in Malawi are seen as beneficial to sector functioning. However, CRS data separately identify commitments from disbursements. the key feature of SWAps in Malawi has been the financing However, the data do not allow examination of annual budget model, especially sector budget support, which was suspended execution because spending against commitments spans in 2014. multiple years, and as several projects may be included in the figures, so any one project commitment cannot be distinguished Even without budget support, other external financing from the start of another. In the questionnaires completed models are available. Malawi’s health and education sectors by DWDOs and DEHOs, there was an open question about have new post-2014 donor funding models – the HSJF and the challenges. Poor budget execution by donors and NGOs was not Education Sector Joint Fund. These funds are for donor funds reported as a significant challenge by donors. In particular, only 3 only (the sector budget support had included pooling with GoM of the 57 completed questionnaires highlighted delays in donor funds) but are partially aligned with GoM PFM systems, in that funding as a major constraint. they use GoM bank accounts. However, the bank accounts are jointly signed by the GoM and a ‘fiscal agent’ that is an 5.2.4 External aid partners and coordination independent donor-controlled entity that maintains oversight over all use of the funds38. Another important feature of the HSJF and Effective aid coordination at the district level is supported Education Sector Joint Fund is that funds can be earmarked to by District Coordinating Teams (DCTs). The significance of one donor, rather than being pooled between donors39. Therefore, effective aid coordination was highlighted by most districts given it is possible for the HSJF to be used on an earmarked basis by the huge size of donor funding to WASH. A total of eight districts WASH sector donors that wish to support exclusive aspects of visited during the WASH PER had functional DCTs. sanitation and hygiene. The HSJF is a vehicle for bringing more donor funds to the health sector (of which sanitation and hygiene About 44% of district WASH staff reported coordination is a part), which gives the GoM a leadership role in coordination, challenges with partners. Among the coordination challenges while donors can maintain adequate fiscal oversight. are issues such as limited consultations by some partners during the development of their proposals. This results in limited The HSJF arrangement was signed in December 2015 and alignment of partner projects with district priorities. For example, is overseen at the central level by MoHP, with a central- some partners support S&H activities falling under their project level fiscal agent. However, a recent innovation is district-level impact areas, and not district S&H priority areas. About two-thirds funding within the health sector, involving a district-level bank of the challenges reported were in the areas of coordination of account with a district-level fiscal agent40. This structure enables WASH activities. district-level donors and NGOs to contribute funds to specific districts for earmarked purposes. At the same time, these funds There are at least 87 different partner organisations funding are under the leadership of the district office and under the the WASH sector at the local level. About 71 of these partners coordination of DCTs. are working on water projects, with 10 of them featuring in six or more districts. These partners include (number of districts in parenthesis): World Vision (18), UNICEF (14), Southern Region 35 Under a SWAp, the Government and donors would agree to common operating principles, for example including a coordinated investment program and shared monitoring arrange- Water Board (10), CADECOM (9), Central Region Water Board ments. 36 Malawi is part of the Sanitation and Water for All (SWA) partnership, under which 7 (9), United Purpose (8), Water Aid (7), Red Cross (6), ONSE (6), standing commitments have been made formalising a Sector Wide Approach (SWAp) in and the Northern Region Water Board (6). the WASH sector. 37 See the Water Sector Investment Plan (2012), page 70. 38 The health sector uses as a fiscal agent a German fund management specialist, with three officers based in MoHP. The education sector is using a local accounting firm. For S&H, about 61 different partners were identified, 45 of 39 The three development partners in the HSJF are DFID, Norway, and KfW. Though DFID which are also funding water projects. A total of seven of the and Norway often choose to pool their funding, KfW funds specific outputs that are differ- ent from those funded by DFID and Norway. 40 This programme is expected to start with the district-level fiscal agent services being 34 Notably the UK (Department for International Development (DFID)) and Australia (Depart- provided by a USAID-funded programme called Local Governance Accountability and Per- ment of Foreign Affairs and Trae (DFAT)). Additionally, the EU’s large WASH programme formance (LGAP), which builds district-level capacities, including PFM. LGAP is expanding comes to an end in 2019, without a clear replacement/replenishment. to all districts. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 29 PUBLIC EXPENDITURE REVIEW
Community-controlled financing. Since 2010, Malawi’s education sector has implemented a model of community- IGURE I controlled grants to each primary school. These grants are W planned and overseen by School Management Committees, with a bank account that is jointly signed by the Chair of the 35,000 Committee and the GoM-employed head teacher. Transparency is excellent: for example, head teachers post school grant budgets on their office walls. Since 2011, school grants have been funded 30,000 by the GoM and are seen to be a highly effective way to spend resources for local impact with sustain ed results. 25,000
As a result of the success in the education sector, a similar 20,000 arrangement is now underway in the health sector, with grants to Health Centre Management Committees and a bank account 15,000 that is jointly signed by the committee chair and the health centre GoM ‘in-charge’. This community oversight of spending is leading to strong outcomes like in the education sector, with 10,000 the same transparency advantages. For example, one District Council Chair has remarked, while looking at the grant budget 5,000 information posted on a health centre wall, that he wished that the district office demonstrated the same degree of spending 0 transparency with regard to GoM funds. 2014/15 2015/16 2016/17 2017/18 2018/19
Domestic Kiosks Whether or not a formal SWAp is adopted, it is important that Institutions Commercial MoAIWD and MoHP are able to provide suitable secretariat services for aid coordination. For this reason, the Water S Authors’ analysis of financial reports received from each water board. Supply Services Department in MoAIWD and the Environmental Health Department (Water, Sanitation and Hygiene Unit) within The volume of water sold by the water boards has not MoHP may need occasional financial and technical support – for increased much over the five-year period, at a time when example, to enable active coordination with and within districts income/m3 has sharply increased. Across all sources, income/ (i.e. through DWDOs and DEHOs). Similarly, the WESNET has m3 increased by 32% in real terms between 2014/15 and 2018/19. an important role to play in coordinating regular reporting of This increase was most significant for institutional (39%) and expenditure information from donors and NGOs in the sector. commercial (35%) customers. 5.3 Water board revenue The increase in income/m3 reflects higher prices as shown in Water board revenue has substantially increased between Figure 27 and Figure 28. This is a cause for concern as increases 2014/15 and 2018/19. The growth in revenue has primarily been in utility costs is cited by the World Bank (2018) as one of the key driven by increased expenditures by institutional and commercial inflationary pressures in Malawi, especially in urban areas. organizations. Revenue from domestic sources increased slightly in real terms from 2014/15 to 2016/17 but has barely changed Water boards generally report good profit, at 14% (MWK 4.5 thereafter. Water board income is a proxy for water sector billion) in 2017 as shown in Table 13. Notwithstanding working expenditures by their customers, i.e. water board fees paid by capital requirements for service expansion, the high turnover households, the private sector, and the government. raises some questions with respect to the necessity of these price increases for the financial health of utilities.
TABLE 12 Invoiced sales of the five water boards TABLE 13 Post-tax profit of four of the five water boards in (MWK million – 2014/15 prices) 2017 (MKW million – nominal) 14/15 15/16 16/17 17/18 18/19 Revenue Profit Profit (%) Domestic 8,967 10,732 12,147 12,557 13,264 Lilongwe Water Board 15,772 3,718 24% Kiosks 286 369 368 358 347 Central Region Water Board 3,104 191 6% Institutions 8,478 9,549 10,889 12,719 12,473 Northern Region Water Board 6,121 66 1% Commercial 6,298 6,201 7,603 8,233 8,589 Southern Region Water Board 7,006 597 9% Total 24,030 26,851 31,008 33,866 34,672 Total 32,002 4,573 14% Sources: Authors’ analysis of financial reports received from each water board Sources: Authors’ analysis of financial reports received from each water board. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 30
Water boards are vulnerable to political pressures. From a IGURE I formal perspective, the prices set by water boards are affected W by restrictions on domestic tariffs raised by the government. There are usually delays in effecting new tariff structures due to government bureaucracy. From an informal perspective, politics 1200 may play a significant role in determining what happens with water boards’ revenue, if they are viewed as ‘rich’. 1000 5.4 Household expenditure
800 Household expenditure is the largest source of financing to the WASH sector, accounting for nearly 60% of funding. Household expenditure on water and soap was estimated using 600 data from the fourth Integrated Household Surveys (IHS4) data41. The IHS report households’ average monthly expenditure on a range of items, including water and soap. However, household 400 expenditure on constructing sanitation facilities is not included. Expenditure on constructing of sanitation facilities is likely to
200 be substantial, given the progress realized on reducing open defecation from 2008 to 2016. The contribution of households to WASH financing in Malawi may thus be underestimated. 0 2014/15 2015/16 2016/17 2017/18 2018/19 TABLE 14 Estimated household expenditure on WASH items Domestic Kiosks (2016) Institutions Commercial Average household Estimated to- Number of expenditure (MWK tal household Item S Authors’ analysis of financial reports received from each water board. households billion) expenditure Monthly Annual (MWK billion) Water 3,766,571 777 9,329 35.1 Soap 3,766,571 875 10,495 39.5 IGURE W Source: Malawi IHS 4 (2016/17) Household expenditure was calculated by adjusting the 60 2015/16 figures for inflation and population growth. To enable the estimation, per capita household expenditure for 2015/16 was assumed constant through the five-year period. 50 However, given the increases in water board prices (see Section 5.3), it is likely that household expenditure between 2016/17 and
40 2018/19 are higher than the estimates in this PER.
TABLE 15 Estimations of household expenditure 30 14/15 15/16 16/17 17/18 18/19 Water 1 28.8 35.1 42.7 48.8 54.4 20 (MWK billion) Soap 32.3 39.5 48.0 54.9 61.2 (MWK billion)1 10 Inflation factor2 0.842 1.000 1.182 1.316 1.429 Population 0.972 1.000 1.028 1.056 1.084 factor3
0 Source: 1. Malawi IHS 4; 2. Ministry of Finance Annual Economic Reports; 3. census. 2014/15 2015/16 2016/17 2017/18 2018/19 Household expenditure on soap is substantial and of interest Domestic Kiosks with regards to hygiene practices in Malawi. However, given Institutions Commercial its predominantly consumer-based nature, such expenditure has little relation to the broader government or donor expenditure. S Authors’ analysis of financial reports received from each water board.
41 Analysis was done by the authors from the raw data downloaded from https://microdata. worldbank.org/index.php/catalog/1003 and https://microdata.worldbank.org/index.php/ catalog/2936. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 31 PUBLIC EXPENDITURE REVIEW
There was a substantial increase in household expenditure 2010 and 2016, and as such this likely44 represents a dramatic between 2010 and 201642, from MKW 24.6 billion to MWK39.5 recent change in the composition of sector funding. Expenditure billion (using 2016 as base year). Households in urban in urban areas accounts for over 60% of all household expenditure areas spend substantially more per month on soap products on WASH, despite urban households accounting for less than (~MWK1,300) than those in rural areas (~MWK750). 15% of the population. The expenditure per household per year on water in urban areas was over MWK 35,000; this figure drops Household expenditure on water has policy significance to below MWK 10,000 in rural areas. In both rural and urban as it is largely linked to expenditures by water boards. In areas, and in all regions, there was a substantial increase in real 2016 households were estimated to spend MKW 35 billion (2016 annual household expenditure on water. This increase was most prices) on water – 36% of which (MWK ~13 billion) was directed marked in urban areas and in the Northern Region. to water boards43. As such, 64% of household expenditure on water is spent on other providers. This is likely to include: fees 5.5 Expenditure in emergencies paid to WUAs; expenditure on self-supply; purchasing water DODMA provides oversight and coordination of nine clusters from informal providers (non-water board); and bottled water. which respond to disasters in Malawi. Two of these clusters This ‘non-water board household expenditure’ represents a large include WASH and health45. The latter has sanitation and hygiene portion of funding to the sector, though it is potentially a ‘blind components, e.g. the provision of chlorine-based water projects. spot’ in policymaking as these expenditures are not regularly However, most WASH interventions fall under the WASH cluster. tracked. Though this expenditure is outside of GoM control and This cluster is chaired by MoAIWD. The ministry has a specific budget processes it is significant for policy as GoM policy and desk officer (within the water and sanitation directorate) who expenditures have the potential to influence how effectively this is responsible for coordinating activities (in collaboration with household expenditure is used. DODMA) within the cluster. During disasters, the cluster’s main activities involve: (a) the provision of safe water to flood-affected The analysis of changes between the previous two people; (b) the provision of adequate sanitation and hygiene expenditure surveys (in 2010 and 2016) highlights a large facilities; (c) the provision of hygiene education and information; increase in real expenditure per household and in absolute and (d) the provision of WASH facilities in health facilities and terms. Household expenditure doubled in real terms between schools. 42 The two previous IHS surveys. 43 This is estimated by the PER team based on an analysis of the water boards’ revenues. Household expenditure on water boards is taken to be the revenue from kiosks and domestic customers. Each year, the GoM sets aside money under the ‘Unforeseen Circumstances’ vote in the annual budget. The budget allocated to DODMA varies each year and is usually only for IGURE H DODMA’s operational costs, i.e. not for emergency response46. W During years which require a disaster response, the Treasury may
40 40,000 release additional funds to finance activities of the nine clusters. Government funding for emergencies is erratic and very low. In 35 35,000 the five years of the PER period, this has only happened once – in 2015, when MWK 500 million was released. The WASH 30 30,000 cluster response team had budgeted their activities for the 2015 response at about MWK 200 million. However, of the MWK 500 25 25,000 million they report receiving only MWK 22 million for water and MWK 46 million for sanitation and hygiene. 20 20,000 MWK MWK, billions 15 15,000 Most activities prepared/coordinated by the DODMA WASH cluster are financed by development partners, either through 10 10000 UNICEF or other partners. Apart from UNICEF, DODMA listed 13 partners working in emergencies: 1. United Purpose, 2. World 5 5,000 Vision, 3. Plan International, 4. Goal, 5. Interaide, 6. Water for People, 7. Red Cross, 8. Assemblies of God Care, 9. PRDO, 10. 0 0 Malawi Urban Rural Northern Central Southern Water Missions, 11. WaterAid, 12. Médecins sans frontières, and 13. Catholic Relief Service. DODMA does not have budget 2010 total HH expediture (MWK Bn - 2016 prices - left-hand axis) information on these activities. 2016 total HH expediture (MWK Bn - 2016 prices - left-hand axis) Average expenditure per HH (2010 - MWK - right-hand axis) 44 The PER team did not review WASH expenditure dating back to 2010 as this was outside Average expenditure per HH (2016 - MWK - right-hand axis) the review period and as such this is conjecture. 45 The full list of clusters is as follows: food security; agriculture; health; nutrition; education; protection; water and sanitation and hygiene; transport and logistics; shelter and camp S Authors’ analysis of IHS 3 and IHS 4 data. management; and coordination and assessments. 46 For example, in 2015, DODMA received MK 150 million from this vote for internal use. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 32
A few districts reported partners that support WASH increases have largely just kept pace with inflation. In real terms emergencies. Amongst the 26 questionnaires completed by there was a dip in sector expenditure from 2014/15 to 2016/17. DWDOs, only two mentioned the role of partners in emergencies Expenditure in real terms per capita follows a similar trajectory and only three mentioned the role of the 28 responding DEHOs. to real expenditures, though with an overall reduction seen due Apart from UNICEF, no information is available on emergency to population growth. expenditures by partners. The PER questionnaire response from UNICEF identified three programmes involving expenditures on emergencies in 2018. These emergency expenditures totalled IGURE T $1,776,000, equivalent to about MWK 1.3 billion. One of three programmes was a multi-year emergency programme on which 50,000 spending was $587,000, $654,000, and $885,000 in 2015, 2016, 200 and 2017, respectively. The UNICEF response did not identify implementing partners (e.g. United Purpose in Phalombe according to the DEHO). No other partner that responded to the PER questionnaire provided information on disaster/emergency 40,000 expenditure; nor was there such detail in the WESNET survey. 150
5.6 Total sector expenditure MWK Figure 30 shows the total of all Malawi WASH sector MWK, billions expenditures, in both nominal and inflation-adjusted terms, 100 30,000 in the five years of the PER period from 2014/15 through to 2018/19, with Table 16 and Table 17 showing the underlying real and nominal data, respectively. The tables are based on the key sources considered under the PER, which includes: GoM expenditures, externally funded expenditures, expenditure by 50 20,000 the water boards, and household expenditure. Each of these 14-15 15-16 16-17 17-18 18-19 sources has been discussed individually in detail in Sections 5.1 to 5.4 above. Real (MWK bn - 2014/15 prices) - left hand axis Nominal (MWK bn) - left hand axis Real per capita (MWK) - right hand axis Total expenditure reached MWK 196 billion (nominal) in 2018/19. In per capita real terms there has been no significant S see Table 16. change in sector expenditure over the last five years. Expenditure has increased substantially in nominal terms, but these
TABLE 16 Total sector expenditure by source (MWK billion – real 2014-15 prices)
Five-year 14/15 15/16 16/17 17/18 18/19 proportions GoM expenditure1 2.1 1. 9 2.1 4.0 3.3 2.4% Donors (ODA)2 Public sector 18.2 8.7 6.3 11. 7 13.9 10.8% Non-public 9.5 13.4 14.2 11. 6 8.6 10.5% sector Water boards (excl. from households)3 15.1 16.1 18.9 21.3 21.4 17.0% Household4 Water (paid to 9.0 10.7 12.1 12.6 13.3 10.6% water boards) Water (other than water 19.8 18.8 18.3 18.7 18.8 17.3% boards) Soap 32.3 33.3 34.2 35.1 36.1 31.4% Overall WASH expenditures 106.0 103.1 106.1 114.9 115.4 100%
GDP5 (Annual Economic Report) 5,944 5,938 6,099 6,100 6,443 % of GDP 3.30% 3.21% 3.22% 3.49% 3.31% 3.31%
Source: Data from Sections 5.1 to 5.4. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 33 PUBLIC EXPENDITURE REVIEW
TABLE 17 Total sector expenditure by source (MWK billion – nominal)
14/15 15/16 16/17 17/18 18/19 GoM expenditure1 2.1 2.3 2.9 6.2 5.5 Donors (ODA)2 Public sector 18.2 10.4 8.8 18.3 23.6 Non- public sector 9.5 16.0 20.0 18.1 14.7 Water boards (excl. from households)3 15.1 19.1 26.5 33.3 36.3 Household4 Water (paid to water boards) 9.0 12.7 1 7. 1 19.6 22.5 Water (other than water 19.8 22.4 25.6 29.2 31.9 boards) Soap 32.3 39.5 48.0 54.9 61.2 Overall WASH expenditures 106.0 122.4 148.9 179.6 195.8
Source: As for Table 16.
Figure 31 shows the five-year average of the proportions boards. Another factor is donor expenditures, of which one-third of each of the four expenditure sources. GoM expenditures goes to the urban sub-sector. Overall, this result is inequitable as (described in Section 5.1) account for only 2.4% of total sector only about 16% of households are urban. Spending on sanitation expenditure. However, GoM expenditures, while relatively and hygiene shows a better mix between rural and urban, though small, represent the most significant part of overall WASH it is still inequitable. The result for sanitation and hygiene is activities. Externally-funded expenditures (described in Section dominated by expenditures on soap, which totals nearly 80% 5.2) account for 21.3% of sector expenditure. Water board of sanitation and hygiene expenditures. Soap expenditures are expenditures (detailed at Section 5.3) account for 17.0% of sector disproportionately higher in urban households. expenditure. Household expenditure (considered in Section 5.4) is the dominant element of total sector expenditure, accounting for 59.3% of total expenditures. IGURE S W ,
IGURE P 80
70 GoM EXPENDITURE 60 HOUSEHOLDS EXTERNAL 50 EXPENDITURE
40
30
20
10 WATER BOARDS (EX HHS) 0 Rural Urban Rural Urban Rural Urban Rural Urban water water S&H S&H water water S&H S&H Ex i I i x i x i S Table 16 data. GoM Donors Water Boards Households
5.7 Analysis of all WASH expenditures by sub- S Table 16 data analysed based on assumptions in Annex J. sector Figure 32 and Table 18 present expenditure from all sources by sub-sector and highlight that water accounts for 60.7% of total sector expenditures, of which nearly 60% is spent in urban areas. This is driven by large expenditures through water MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 34
Each of the four sub-sectors relies on a different financing financing and will also be heavily affected by changes in donor mix. The rural sub-sector is comparatively more reliant on donor financing trends. Household expenditure is significant in all sub- funds and progress in the sector is more likely to be dependent sectors. Notably, over 57% of expenditure in the rural water sub- on variations in this funding. Furthermore, sanitation and hygiene sector is by households. in both rural and urban areas is heavily dependent on donor
TABLE 18 Expenditure by sub-sector by funding source (MWK billion, 2014/15 prices)
14/15 15/16 16/17 17/18 18/19 5 year Rural water 25.8 26.6 24.5 28.9 31.0 25.1% GoM 0.4 0.7 0.8 2.2 2.2 1.2% Donors 5.6 7.1 5.4 8.0 10.0 6.6% Households 19.8 18.8 18.3 18.7 18.8 17.3% Urban water 39.4 33.9 36.9 42.9 42.3 35.8% GoM 0.8 0.4 0.4 0.8 0.1 0.5% Donors 14.6 6.6 5.6 8.2 7.6 7.8% Water boards 15.1 16.1 18.9 21.3 21.4 17.0% Households 9.0 10.7 12.1 12.6 13.3 10.6% Rural sanitation and hygiene 29.4 32.2 32.5 31.6 32.0 28.9% GoM 0.9 0.8 0.9 0.9 1.0 0.8% Donors 4.4 6.6 6.2 4.7 4.4 4.8% Households (soap) 24.1 24.8 25.4 26.0 26.7 23.3% Urban sanitation and hygiene 11.4 10.5 12.2 11.5 10.0 10.2% GoM 0.0 0.0 0.0 0.0 0.0 0.0% Donors 3.2 1.9 3.3 2.4 0.6 2.1% Soap 8.2 8.5 8.8 9.1 9.4 8.1% Total expenditure 106.0 103.1 106.1 114.9 115.4 100.0%
TABLE 19 Expenditure by sub-sector by funding source (MWK billion, nominal)
14/15 15/16 16/17 17/18 18/19 Rural water 25.8 31.6 34.4 45.1 52.5 GoM 0.4 0.8 1. 2 3.4 3.7 Donors 5.6 8.4 7. 6 12.5 1 7. 0 Households 19.8 22.4 25.6 29.2 31.9 Urban water 39.4 40.2 51.9 67.0 71.9 GoM 0.8 0.5 0.5 1. 3 0.2 Donors 14.6 7. 9 7. 8 12.8 12.8 Water boards 15.1 19.1 26.5 33.3 36.3 Households 9.0 12.7 1 7. 1 19.6 22.5 Rural sanitation and hygiene 29.4 38.2 45.6 49.4 54.4 GoM 0.9 1. 0 1. 2 1. 4 1. 6 Donors 4.4 7. 8 8.7 7. 4 7. 5 Households (soap) 24.1 29.4 35.7 40.7 45.3 Urban sanitation and hygiene 11.4 12.4 1 7. 1 18.0 1 7. 0 GoM 0.0 0.0 0.0 0.1 0.1 Donors 3.2 2.3 4.7 3.7 1. 0 Households (soap 8.2 10.1 12.4 14.2 15.9 Total expenditure 106.0 122.4 148.9 179.6 195.8 Sources: Table 16 data analysed based on assumptions in Annex J. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 35 PUBLIC EXPENDITURE REVIEW © UNICEF/2015/Chikondi
6. SECTOR PERFORMANCE The discussion and analysis in this section is presented across water and sanitation and hygiene separately. In each section an IGURE A overview of sector performance is given, followed by a discussion of the efficiency and equity considerations in each sector.
100 6.1 Access to improved drinking water Access to improved water sources increased over the census, IHS, and DHS time periods. Figure 33 shows that access to 80 improved water source increased from 74.2% to 85.4% over the census period (2008-2018) and from 79.7% to 87.2% over the DHS period (2010/11 to 2015/16). Estimates using the IHS data 60 revealed similar trends, with access to improved water source increasing from 78.7% to 87.1% between 2011 and 2016.
Percentage (%) Percentage 40 The progress in the period 2010–2015 was associated with more external resources in the run-up to the MDG deadline. Huge donor commitments to the WASH sector were made in 20 2011, 2012, and 2013 (see Figure 22 in Section 5.2.1). Research jointly undertaken between the GoM and the Climate Justice Fund (Truslove et al., 2019) highlights that there was a ‘spike’ in new hand pump installations in 2012 and 2013. New installations 0 2008 2018 2010 2015 2011 2016 of Afridev hand pumps increased from under 600 in 2011 to C DHS IHS nearly 1,400 in 2012 and 2013, with an additional 800 hand pumps installed in 2014. S Census 2008 and 2018, DHS 2010 and 2016, IHSs 3 and 4. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 36
As previously highlighted (Table 16 in Section 5.6) donor In recent years, there has been moderate progress in water expenditure constitute a large proportion of WASH sector point functionality in some districts, but a significant drop development expenditure and is also the most variable in others. Nationally, water point functionality fell from 77% to expenditure element. Although combined household, water 71% between 2016/17 and 2017/18. Water point functionality in board, and GoM expenditures are larger than donor expenditure, 2017/18 varied widely by district – from 51% in Nsanje to 98% in much of the expenditures from these sources finance recurrent Likoma. Compared to 2016/17, water point functionality declined items such as operations and maintenance (O&M). This means significantly for districts in the South such as Nsanje, Chikwawa that progress on new WASH infrastructure is largely linked to and Phalombe, among others. This is probably linked to recurring external funding. floods which disproportionately affect the southern parts of the country.
IGURE W
100%
80%
60%
Percentage (%) Percentage 40%
20%
0%
Neno Dowa Dedza Balaka Likoma Mchinji Salima Ntcheu Ntchisi Chitipa Rumphi Zomba Nsanje KasunguMwanzaLilongwe MulanjeBlantyreMzimbaKaronga Mangochi PhalombeMachinga Chikwawa ChiradzuluNkhata BayNkhotakota
Water point functionality 2017-18 Water point functionality (2016-17)
S Functionality data reported by districts in 2017/18 and 2016/17 sector performance reports – MoAIWD (2019) and MoAIWD (2018).
6.1.1 Water board performance TABLE 20 Number of active connections In recent years the water boards have successfully extended services to more users, with the most significant expansion # of active % in Lilongwe. Overall, between 2016/17 and 2017/18 the water Organisation connections Increase Increase boards installed over 28,000 connections, representing a 13% 16/17 17/18 Blantyre Water year-on-year increase in active users. However, the expansion in 45,510 49,972 632 1.3% the number of household connections has not directly translated Board Central Region into consistent access to improved drinking water as households 24,569 25,567 998 4.0% Water Board often face prolonged water cuts. Lilongwe Water 60,550 79,400 14,350 23.7% Board Northern Region 42,053 44,715 2,662 6.0% Water Board Southern Region 39,897 41,031 1,134 2.8% Water Board Total 212,579 240,685 28,106 13.2%
Source: MoAIWD (2019). WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 37 PUBLIC EXPENDITURE REVIEW
One area of concern relates to non-revenue water (NRW), 6.1.2 Efficiency considerations in the water sub-sector which has not significantly improved in recent years. Non- A key water sector efficiency consideration relates to revenue water refers to the water produced by water boards that water point functionality. Figure 35 and Figure 36 show the is ‘lost’ in between production and the point at which it reaches relationship between the number of frontline staff and water the consumer. Key reasons for NRW include leakages (‘physical point functionality and the ORT allocation per capita and water losses’) and illegal connections, theft, or inaccuracies in billing point functionality. These are seen to be the two areas of (‘apparent losses’). Overall, non-revenue water increased district council expenditure linked to maintaining water point between 2016/17 and 2017/18; largely driven by increases for the functionality. central region water board (CRWB) and southern region water board (SRWB). There was a substantial reduction in non-revenue water for the Blantyre Water Board. Adequate staffing is an essential component of effective service delivery, and a recognised challenge in the rural water sub-sector. The number of WMAs per person in the TABLE 21 Non-revenue Water (NRW) for the period 2016/17- district averages 1:230,966, suggesting that each WMA on 2017/18 average is responsible for monitoring the services of a quarter of a million people. This level of staffing varies widely between NRW Water board 16/17 (%) 17/18 (%) districts and is correlated with the functionality rates in the change district. On average, functionality rates are higher in districts Lilongwe Water Board 36.5% 36.1% -0.4% where there are more WMAs per population served (see Figure Blantyre Water Board 43.0% 39.0% -4.0% 35), though there is considerable variation. The 2017/18 Sector Central Region Water 27.0% 30.0% 3.0% Performance Report highlighted that there is a ‘68% vacancy rate Board of professional establishment positions indicating a decrease by Northern Region Water 33.0% 34.0% 1.0% Board 1% as compared to the 69% reported in the previous year’. Southern Region Water 24.7% 28.9% 4.2% Board Overall 32.8% 33.6% 0.8%
Source: MoAIWD (2019).
IGURE R W A
800,000 100%
700,000 80% 600,000
500,000 60%
400,000
40% 300,000
200,000 20%
100,000
0 0%
Neno Thyolo Balaka Dowa Nsanje Mchinji Salima Ntcheu Chitipa Rumphi Lilongwe Blantyre Mulanje Mzimba Mwanza Karonga Machinga Phalombe Chikwawa Mangochi Nkhata Bay Nkhotakota Chiradzulu
WMA: population Water point functionality Linear (WMA: population (average)) Linear (water point functionality)
S District reports to PER team (staffing), and Sector Performance Reports (functionality) MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 38
There is no significant correlation at budgetary level for major repairs and poor management/ governance47. The between ORT funds and water point functionality at the importance of capacity building for WUAs is strongly recognised local level. Districts use part of ORT funds to support operations in the 2012 Malawi Sector Investment Plan. Yet, besides ad hoc and maintenance of water points. However, a correlation analysis initiatives by donors and NGOs, this recognition has not been of per capita ORT funds and water point functionality show no widely operationalised over the period 2014/15 to 2018/19. clear relationship between the two variables. This could mean that the current size of ORT allocations is too low to affect the Efforts to improve functionality in rural areas have centred on outcome, or are ineffectively spent. The annual average district training area mechanics and linking them to shop partners ORT budget for water over the PER period was just over MWK who stock parts. The 2017/18 Sector Performance Report 5 million (~US$7,000). During the district case studies, WMAs reports that 519 such area mechanics have been trained in the frequently reported that ORT did not reach frontline staff for past few years. Such initiatives are unquestionably essential to maintenance activities. The average annual ORT allocation per sector functioning. However, they do not address the issue of capita 2015/16 to 2018/19 was just MKW 20 per person per year. how repairs are funded. In considering improving water point functionality there is a need also to focus on the role of the As highlighted in Section 5.4 non-water board household WUAs in financing and managing O&M; this is discussed further expenditure is a substantial proportion of sector expenditure, in Section 7.4. and a proportion of this is anticipated to be spent on WUA fees. As indicated earlier, the WUAs have delegated The introduction of the Borehole Fund has significantly responsibilities for the operations and maintenance of small increased development expenditure at the district level, but water systems. Currently, the WUAs do not receive dedicated interventions may not always be effective. There is evidence support from either the Government or development partners. that Borehole Fund spending is highly politicised. District-level Capacity challenges were also noted in some of the WUAs. staff interviewed highlighted that spending decisions under the Borehole Fund and the CDF are made by the constituency’s MP. The challenges in Malawi associated with a community- Some DWDOs report that this can cause issues when it comes based management and WUA model are well documented to siting and installing boreholes, as the sites chosen by the MP and evidenced (Truslove et al., 2019; Wahba et al., 2017). Key may not be suitable. It is also common for borehole installations constraints facing the WUAs include lack of external support 47 Further challenges to functionality of note include: poor initial installation (Mannix et al., 2018) and the use of complex technologies (i.e. non-VLOM technologies).
IGURE ORT
50 100%
40 80%
30 60%
20 40%
10 20%
0 0%
Dowa Neno Dedza Zomba Ntchisi Likoma Nsanje Thyolo Balaka Mchinji Salima Ntcheu Chitipa Kasungu LilongweBlantyreMulanje Mzimba Mwanza Karonga Machinga Phalombe Chikwawa Mangochi Nkhata Bay Nkhotakota Chiradzulu
ORT per capita (15/16-18/19 annual average) Water point functionality Linear (water point functionality)
S District reports to PER team (staffing), Sector Performance Reports (functionality), and budget documents (ORT allocations). * Average annual amount funded 2015/16–2018/19. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 39 PUBLIC EXPENDITURE REVIEW
to be done by private contractors at the direction of the MP, there was no reduction in inequities between these two groups, as opposed to through the DWDO. The limited involvement although the gap between them and the richest quintile closed of the DWDO in installing water points is a source of concern a little. as it raises questions surrounding value for money and quality assurance, and issues related to the future O&M. The quality Although the Borehole Fund is a major area of WASH of the initial installation of water points has been shown to expenditure at district level, its targeting is not according to be a key determinant of the future functionality. Arguably, not district water needs. This is clearly highlighted in Figure 38. A involving the DWDO in supervising the construction and siting targeted allocation criterion for the Borehole Fund would favour of boreholes constructed under the Borehole Fund increases districts with low levels of access to water. However, the current the likelihood of poor targeting limiting the effectiveness of distribution shows substantial variations with some districts with Government expenditure. the lowest levels of access receiving lower per capita Borehole Funds than other better performing districts. 6.1.3 Equity considerations in the water sub-sector Where donors and NGOs focus their programmes has a A detailed analysis of the DHS 2010 and 2016 was conducted strong influence on who is reached with services. Once a to assess the degree to which progress in water access was donor or NGO has selected a district to work in, the decision pro-poor48. There are sharp inequalities in terms of access to regarding where to work is determined with the DCT. District basic services, that are deeply rooted in an urban/rural divide. staff report that the allocation of NGOs to TAs is designed to With over 80% of the population living in rural areas, there is a minimise overlaps and duplication of efforts. A broader equity marked difference between the wealthiest quintile and the other consideration relates to the process by which donors decide four quintiles. Progress in improving access to drinking water which sectors to fund, and through which channels. The analysis has not been pro-poor, and significant disparities in access based of donor expenditure and projects has shown a tendency for on wealth remain. Nationally, the rate of improvement between recent donor funding to be primarily channelled to urban areas the poorest and middle quintiles was similar. Consequently, and through the water boards. The new large WASH projects of
48 The datasets for these surveys are publicly available, enabling the PER team to re-analyse the AfDB and World Bank have tended to focus on urban areas. the raw data to produce estimates for access by wealth quintile and region. This analysis was not possible using the 2018 census data as these have not been publicly released. While the PER does not seek to question the validity or necessity
IGURE P
100%
95%
90%
85%
80%
75%
70%
65%
60%
55%
50% 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016
Poorest* Middle* Richest Poorest Middle Richest Poorest* Middle* Richest* Poorest Middle Richest
N C S
S Malawi DHS 2010 and 2016. * Point estimates are from survey data. The error bars are included for the 95% confidence interval. A ‘*’ indicates where the change within a group was within the margin of error. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 40
IGURE P B
10,000 100%
8,000 80%
6,000 60%
4,000 40%
2,000 20%
0 0%
Balaka Neno Dedza Dowa Thyolo Zomba Nsanje Chitipa Salima Mchinji Ntchisi Rumphi Ntcheu Karonga Mwanza Mulanje BlantyreMzimba Lilongwe Kasungu Phalombe Mangochi Chikwawa Machinga Chiradzulu Nkhata Bay Nkhotakota
Borehole fund allocation per HH without access Access to improved water (right-hand axis)
Linear average Linear (access to improved water (right-hand axis)
S Census 2018 (access data), budget documents (Borehole Fund allocations). N Likoma is excluded as it significantly distorts the picture. Per capita ORT funding in Likoma is MWK 853.
of these investments it remains the case that the limited donor funding is concentrated in urban areas: there is comparatively IGURE P little funding for developing services in the WASH-disadvantaged rural areas.
15 6.2 Sanitation and hygiene Similar to progress on water access, sanitation outcomes49 improved over the Census and DHS periods. Open defecation 12 rates declined from 12.8% to 7% over the census period (2008- 2018) and from 10.8% to 6.2% over the DHS period (2010/11 to 2015/16). However, estimates using the IHS data revealed 9 a slight increase in absolute and relative OD figures, with the OD rate increasing from 8.8% to 8.9% between 2011 and 2016.
This points to some serious concerns surrounding sustainability (%) Percentage 6 in the sector. The vast majority of latrines in Malawi are simple pit latrines and are vulnerable to collapse; this is a widely noted issue in the sector. In using secondary survey data there are 3 issues related to the reliability and treatment of data relating to improved latrines; as such, open defecation and ODF status is the preferred indicator used in the PER to assess sector progress. 0 2008 2018 2010 2015 2011 2016 49 This PER uses open defecation rates, for which data was readily available across all sourc- es, to measure sanitation outcomes in Malawi. C DHS IHS
S Census 2008 and 2018, MICS 2013, DHS 2010 and 2016. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 41 PUBLIC EXPENDITURE REVIEW
As with water, the progress in sanitation during the period 2008–2015 was largely linked to the level of external funding TABLE 22 Progress on ODF declaration in the sector. In particular, progress in rural sanitation is heavily dependent on external resources. The number of (ODF) Indicator Number Total % traditional authorities is a key measure of progress in sanitation. Villages declared ODF 16,794 38,682 43% As at December 2018, 112 of Malawi’s 263 TAs had been declared ODF. Implementation in 86 of these 112 TAs had been funded TAs declared ODF 112 263 43% by external partners. The rising rates of open defecation under Districts declared ODF 4 28 14% the IHS period could be linked to factors such as ODF slippage, lower levels of donor funding in the sector, and with the physical Source: MoHP monitoring data (December 2018). collapse of household latrines due to environmental factors such as heavy rains and floods50.
50 This is an issue that is widely documented in the sector: see UNICEF (2019).
IGURE P
Govt
NGO
0% 20% 40% 60% 80% 100%
S MoHP monitoring data (December 2018)
The expenditures that contribute to outcomes in sanitation efforts (UNICEF, 2019). Staffing levels have been identified as a and hygiene are predominantly related to recurrent key determinant of motivation, with many HSAs reporting feeling expenditures on staff salaries and travel to conduct overworked. promotion efforts. One further area of significant expenditure is household expenditure on latrine construction. However, there The main approach to improving rural sanitation in Malawi was no expenditure information on this variable. (‘community-led total sanitation’) relies on households constructing their own latrine facilities. Recently, other 6.2.1 Efficiency considerations in the sanitation and approaches have been developed such as the participatory hygiene sub-sector hygiene and sanitation transformation (PHAST) and school-led total sanitation (SLTS) as well as sanitation marketing. A recent 83% of GoM funding for sanitation is for salaries. Progress evaluation (UNICEF, 2019) of a large-scale sanitation programme in rural sanitation is heavily dependent on frontline staff (HSAs) in Malawi raised serious concerns surrounding the quality and being able to travel to communities to conduct health promotion. durability of latrines. A survey under the evaluation found that The current average ratio of HSAs to population is 1:1,921, well nearly a third of households living in ODF communities have below the target rate of 1:1000, suggesting frontline preventative experienced their latrine collapsing, with many subsequently healthcare is understaffed. reconstructing it. This issue is recognised in the GoM’s Annual Sector Performance Reports and the new National Sanitation Overall, with population growth, the number of HSAs and Hygiene Strategy 2018–2024 In addressing the issues per person has declined. The number of HSAs and senior of sustainability, the strategy places a strong emphasis on HSAs reported by the districts was 8,479; which is lower than continued monitoring of ODF status, continued follow-up of figures previously reported in other accounts51. This can have community-level health promotion, and the introduction of a consequence for the quality of the health promotion work of market-based interventions (‘sanitation marketing’) aimed at HSAs as they have a larger population to cover and may have improving the quality of sanitation facilities. Sanitation marketing to travel further. Maintaining the motivation of frontline staff is nascent in Malawi and there are few examples of effective is a key determinant of the effectiveness of health promotion programmes at scale. In the short-run there is a need to test and 51 Chikaphupha et al. (2016) reported there were 9,173 in 2016 and the GoM (2010) reported refine approaches that could work at scale. there were 10,507 in 2009. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 42
IGURE R HSA
Zoamba
Thyolo
Balaka
Kasungu
Rumphi
Chiradzulu
Salima
Mulanje
Ntchisi
Likoma
Mchinji
Ntcheu
Dowa
Mwanza
Blantyre
Nkhotakota
Chitipa
Nsanje
Phalombe
Mzimba
Dedza
Nkhata Bay
Chikwawa
Neno
Karonga
Lilongwe
Mangochi
Machinga
0 500 1000 1500 2000 2500
HSA*: Population Linear (HSA*: population (average)) Linear (Target ratio)
S District reports to PER (2019) team *Figures include HSAs and senior HSAs. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 43 PUBLIC EXPENDITURE REVIEW
6.2.2 Equity considerations in the sanitation and hygiene sub-sector
Progress on open defecation has largely been pro-poor, Eliminating open defecation in Malawi will unambiguously although inequalities still exist. In Figure 44 the steepness require targeting the very poorest. However, due to the nature of the line indicates the rate of progress: in all regions and of the budget allocations apportioned to sanitation (staff time/ nationally the rate of reduction was largest among the poorest salary) it is not possible to determine the extent to which current wealth quintile. While this is partially a reflection of the fact that resources are specifically targeted to the poor. rates were higher to begin with it does highlight that spending and efforts in reducing open defecation benefit the least wealthy in society.
IGURE P
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0% 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016
Poorest Middle Richest* Poorest Middle Richest* Poorest Middle Richest* Poorest Middle Richest*
N C S
S Malawi DHS 2010 and 2016. * Point estimates are from survey data. The error bars are included for the 95% confidence interval. A * indicates where the change within a group was within the margin of error.
6.3 Progress on WASH by district Figure 43 (overleaf) presents the progress on water and As noted in the overall analysis, the period 2013–2018 was sanitation by local authority (district and city52). The district- one where the proportion of people with access to water level progress is presented as a percentage point change fell and levels of open defecation increased. This is reflected between 2013 and 201853. It can be read as showing progress in the district-level progress. Access to an improved or traditional in four quadrants: the top-right quarter shows districts where latrine is uneven across districts – increasing in 14 and falling in access is improving for both water and sanitation; the bottom- 17 Local Authorities. Access to water is improving in nine districts right quarter shows where it is falling for both water and and cities and falling in 22 districts and cities. Overall, there are sanitation; and the top-left and bottom-right quarters show four districts where access to both water and sanitation facilities where there was progress in one area but not the other. is improving, and 12 where access rates are declining for both water and sanitation. 52 These data are based on the census and MICS 2013, which capture data for 27 of 28 districts (the MICS 2013 does not have data for Likoma), and four city areas (Blantyre city , Lilongwe city, Mzuzu city, and Zomba city). 53 For example, if open defecation rates fell from 8% in 2013 to 6% in 2018 the number on the graph is -2. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 44
IGURE D
15
Michinji 10 Thyolo I Blantyre I
5
Dowa Neno Chiradzulu Karonga Central Region Ntchisi Zomba City Southern Region Zomba Machinga A 50 -40 30 20 10 0 10 Nsanje 20 30 40 50 Lilongwe Kasungu Phalombe Ntcheu Nkhata Bay Salima Balaka Mulanje Lilongwe City Dedza Malawi Blantyre City Mwanza Mangochi Mzuzu City Chitipa 5 Chikwawa Nkhotakota
Northern Region
10 W Mzimba
15 Rumphi Percentage point change in access to improved water (2013-2018) water in access to improved point change Percentage
20 Percentage point change in access to an improved or traditional latrine (2013-2018) A W I I
S MICS 2013 and Census 2018.
6.4 Alignment between sector spending and supply projects. The SIP also relied on the water boards becoming sector policy profitable (a condition that has been met), and reducing NRW to 20% (a target that has not been met). 6.4.1 Sector investment requirements
The Water SIP (2012) outlines that $140 million is needed A critical assumption in the SIP is that donors (excluding annually from 2015 to 2030 for the sector to achieve 98% development finance institutions) would ‘step up’ their access to improved water supply by 2025 and 90% access grant investments in the sector during 2016–2030. The to improved sanitation by 2030. The majority of the resources analysis in this PER highlights the opposite trend: namely, that needed under the investment plan modelling were for mega- while development finance institutions are increasing their projects associated with urban bulk water. The SIP proposes investment in the sector, bilateral donors are withdrawing from that these would be primarily implemented by the water boards the sector and country. If not reversed, this trend will create a and with funding from development finance institutions (loaning large financing gap that will have to be filled from other sources to the water boards and to GoM). In this respect the funding for Malawi to reach universal access by 2030. A comparison of patterns over the PER period are fully aligned with this plan. the sector expenditure identified under this PER against the SIP Specifically, that new external finance to the sector has been target highlights that the sector is currently funded to just above directed as loans to the water boards for major urban bulk-water 30% of the target level. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 45 PUBLIC EXPENDITURE REVIEW
TABLE 23 Expenditure against investment plan and financing gap
14/15 15/16 16/17 17/18 18/19
Total sector expenditure (MWK billion 2014/15 prices) 196.1 190.7 196.2 212.6 213.4
Sector expenditure in investment plan* MWK billion 99.6 94.3 99.1 113 111.9 (2014/15 prices) USD million** 39.3 37.2 39.1 44.6 44.2
% SIP requirement ($140 million) 28% 27% 28% 32% 32%
Sources: See Table 16 for sector expenditure figures. Target from MoAIWD (2012). * Excludes non-water board household expenditure and household expenditure on soap. ** USD exchange rate used USD: MWK 1:394.97 (rate as at 30 June 2014).
6.4.2 Alignment with the National Water Policy provides the legal grounding for government entities to act as the contracting authority. However, to date there are few examples The overall policy goal of the National Water Policy is the: of large-scale PPPs being used in the sector. In 2018, the World ‘sustainable management and utilization of water resources, Bank International Finance Corporation committed $1.1 million in order to provide water of acceptable quality and of sufficient to the preparation of a PPP in Lilongwe, ahead of an anticipated quantities, and ensure availability of efficient and effective water private sector mobilisation of $15 million. and sanitation services that satisfy the basic requirements of every Malawian and for the enhancement of the country’s In regard to the rural water supply, the emphasis in the natural ecosystems.’ national water policy is on: promoting demand-driven approaches, enhancing user participation in catchment In the urban water sector, the policy’s emphasis is placed management and preventing pollution, promoting community- on: developing bulk-water supply, strengthening management based management, and ensuring the smooth transfer of arrangements, and encouraging public–private partnerships devolved functions. The analysis in this PER has highlighted that (PPPs) in urban service delivery. The 2017/18 sector performance expenditure on community-based management is likely to be report outlines that there has been progress in some areas substantial. However, there is limited evidence of funding for (urban water supply coverage, the number of active users, water WUAs, and since the policy was developed the many challenges production, and operating ratios), but that utility performance has in the WUA model have been well documented. The PER found not improved in some areas (NRW and debtor days). that devolution of functions was supported over the five-year period, with district expenditure accounting for 62% of GoM The sector performance report highlighted the key spending; and that the introduction of the Borehole Fund led to challenges facing the urban water sector as including: high a large increase in spending at the district level. However, the NRW; a high number of long disconnected accounts; frequent analysis of sector performance highlights that there are critical power interruptions and intermittent power supply from ESCOM capacity gaps at the district level (particularly related to frontline affecting water production; high debtors (both government staff) and that ORT funding is low. Functionality rates have institutions and the private sector); degradation of catchment decreased in recent years, highlighting that this critical sector areas resulting in the drying of water sources (e.g. Mpira Dam); challenge is currently not being fully addressed. These findings a high number of disconnected accounts due to a proliferation are consistent with the 2017/18 sector performance report, of boreholes within the supply areas; and a lack of finances to finance large-scale investments in infrastructure. which concluded:
The expenditure findings highlight that the recent trend of development banks funding the water boards directly is well aligned with the stated policy objectives and addresses the challenge of mobilising finance for large projects. The Management of rural water supply systems has sector performance report puts forward the idea that tariffs been a challenge because of inadequate capacity could be raised to mobilise additional finance for large-scale in the local management structures like Water infrastructure projects. However, the PER findings highlight rapid User Associations, Water Point Committees and increases in tariffs in recent years, and that Malawi’s tariffs are already among the highest in the region per m3 – and higher still Area Mechanics. The situation is made worse when compared to GDP per capita54. One area of National Water due to unavailability and increasing prices of Policy that has not received great attention is the introduction spare parts for the Village Level Operation and of PPPs into urban water service delivery. The PPP Act of 2011 Maintenance hand pumps.”
54 https://reliefweb.int/sites/reliefweb.int/files/resources/UNICEF-ESARO-2019-WASH-Financ- ing-Regional-Assessment.pdf MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 46
6.4.3 Alignment with the National Sanitation Policy 6.4.4 Alignment with international policy commitments
The National Sanitation Policy is focused on strengthening Many of Malawi’s key international policy commitments coordination at the national level, and achieving universal are subsumed under the national policy commitments, access in towns, schools, health centres, and rural and urban particularly as both the National Water Policy and the areas. Since the policy was developed there has been enormous National Sanitation Policy place an emphasis on universal progress towards universal access, with open defecation falling access to services. Box 2 outlines some of Malawi’s key rapidly, and a large number of traditional authorities declared ODF. international policy commitments. The sanitation policy envisaged the creation of a new cadre55 of government staff to take on sanitation and hygiene promotion. The latest sector report highlights the need to agree an Ultimately, this was not followed through and HSAs took on approach to achieving the SDGs, as well as deciding the the responsibilities envisaged for this new cadre. This PER has degree to which global progress indicators can be integrated highlighted that there are concerns surrounding the sufficiency with national progress indicators (especially in rural of the number of frontline staff, as well as how well resourced sanitation). As Malawi approaches universal access to basic and managed they are. The national sanitation policy also placed services much of the effort needed to meet the SDGs needs to a strong emphasis on the incremental improvement of sanitation be focused on raising service levels and ensuring the quality and facilities through sanitation marketing, and the safe treatment sustainability of supplies. The level of ambition in the SDGs in and disposal of faecal sludge (particularly in urban areas and respect of ‘safely managed’ services is substantially above that towns). These are policy areas that are not clearly reflected in of the MDGs and their access to ‘basic’ or ‘improved’ services. the spending of government or donor programmes. Similarly, the In water, this entails all households having access to improved PER was not able to clearly identify spending on improving WASH water at their premises that is free from faecal contamination. facilities in schools and hospitals. The latest sector performance In sanitation, this entails that facilities are not shared and that report places a heavy emphasis on developing strategies for faecal waste is safely disposed of. post-ODF, the implementation of sanitation marketing, and an urgent focus on improving WASH in schools. These are all areas Excluding household expenditure, the spending on sanitation where there are no clear funding streams in GoM budgets. and hygiene by the GoM and donors is equivalent to 0.17% of GDP – below the long-standing eThekwini declaration of The costed implementation plan for the National Sanitation 0.5%. Similarly, in the last financial year WASH received 0.45% and Hygiene Strategy 2018–2028 estimates that on average of the government budget, below the 1.5% committed under the MWK 9.7 billion56 is required annually to implement Sanitation and Water for All partnership. activities (see Table 24 below). This compares to current (2018/19) government expenditure on sanitation and hygiene of BOX 2 International policy commitments MWK 1.8 billion (2019/20 prices), of which the vast majority is salaries. There is a clear need for additional investment in the Malawi is a signatory to both the MDGs and the SDGs. sector. Much of the funding for activities in rural sanitation is In the context of water these commitments include: likely to continue to come from external resources in the short run. However, as outlined in Section 5.2, these are falling rapidly • MDG 7: ‘ensure environmental sustainability’; and and are increasingly focused towards urban areas. In the context • SDG 6: ‘ensure availability and sustainable manage- of limited GoM funding for activities (ORT) and the declining ment of water and sanitation for all’. external assistance to the sector, there is a need to target and Malawi is also a signatory to the eThekwini Declaration focus effort. (2013 and 2015), which includes a commitment to allo- cate 0.5% of GDP to sanitation and hygiene (among oth- TABLE 24 Cost of implementing the National Sanitation and er commitments). This commitment is reinforced in the Hygiene Strategy 2018–2024 (MWK million) 2015 N’gor Declaration (emanating from the AfricaSan IV conference – organised by the African Ministers’ Council on Water (AMCOW)). 18/19 19/20 20/21 21/22 22/23 23/24 Average Malawi is also part of the Sanitation and Water for All 7,696 9,033 10,583 9,914 9,966 11,537 9,788 partnership, under which seven standing commitments Source: GoM (2018) National Sanitation and Hygiene Strategy 2018–2028. have been made, including allocating 1.5% of the nation- al budget to the sector, formalising a SWAp, and taking 55 District Sanitation and Hygiene Coordinators. 56 The prices used in the strategy are unclear. steps to support rural water functionality. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 47 PUBLIC EXPENDITURE REVIEW
6.4.5 Summary
Overall, all spending is aligned with certain elements of national policy. The critical challenge is that the sector is substantially underfunded against the investment plan and certain aspects of policy receive little attention. Total sector expenditure is focused on water supply in urban areas. This reflects the large sum of funds mobilised from tariffs and the recent focusing of donor expenditure in the urban water sub- sector. The different sub-sectors rely on different funding streams and the sanitation sub-sector is more highly exposed to changes in donor financing. The Borehole Fund has been successful in mobilising funds for the rural water sub-sector, though there are concerns surrounding how efficiently this is being spent and functionality remains a critical issue in rural areas. In sanitation and hygiene, the lack of a dedicated sector fund may be a contributing factor to the extremely low GoM allocations to the sector, as GoM expenditure in this area is almost exclusively associated with salaries. Progress in any of the individual sub- sectors is highly dependent on the degree to which different financing sources align. This PER has highlighted the importance of household, donor, and water board expenditure in achieving sector outcomes. MoAIWD and MoHP have a central role to play in effectively coordinating these funding streams through policy, regulation, and sector leadership. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 48 © UNICEF/2015/Chikondi
there will be a need to increasingly invest in maintaining existing 7. DISCUSSION AND services over developing new infrastructure. CONCLUSIONS IGURE G SDG 7.1 Government financing in WASH 250 The PER findings highlight that government expenditure is a small proportion of total WASH expenditure. Nonetheless, nearly all funding to the sector (donor or government) relies on government staff to implement programmes. Views expressed 200 during field visits illustrate that government staff are central to effective sector performance.
150 Despite the reliance on government staff for sector performance, ORT transfers, which are essential for effective staff performance, are insufficient for WASH activities. This is
USD, billions per year USD, 100 evident from the views expressed by DWDOs and DEHOs via completed PER questionnaires. It is noted that ORT transfers were only 5.6% of total GoM expenditures on WASH in 2018/19, as shown by figures given in Section 5.1. Under GoM policy it 50 is the WUAs and water boards that are largely responsible for O&M expenditures. Despite this, GoM support to O&M remains an important area to focus on. 0
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Figure 44 reproduces World Bank estimates of the global costs of meeting the SDGs. These estimates highlight the Capital O&M increasing importance of O&M expenditures in ensuring access. As the sector approaches universal access to improved services S Hutton and Varughese (2016) WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 49 PUBLIC EXPENDITURE REVIEW
Government overall financing of the WASH sector is allocation of resources. While DEHOs and DWDOs generally significantly lower than that of other countries in sub- report their involvement in the annual budget process at the Saharan Africa, expressed as a percentage of GDP and as district level as sufficient, the budget process on which they spending per capita. As demonstrated in 2.4, the GoM’s WASH reported is the planning for limited ORT spending, most of which spending was 0.081% of GDP in 2018/19, much lower than that is absorbed by allowances and fuel for activities; so they confirm of Kenya, Ghana, and Mali, and also lower in per capita terms. their limited scope to influence budgets. This is despite Malawi having similar, or lower, access to basic water and sanitation services. On the other hand, centrally determined conditional grants or funds can have a strong influence on sector expenditure. A related concern is Malawi’s substantially higher reliance on This is demonstrated by the sharp increase in district-level external financing relative to domestic financing, compared development expenditure following the introduction of the to other countries. As demonstrated in Section 4.2, the GoM’s centrally determined Borehole Fund. While the introduction of ratio of donor/NGO financing to domestic financing is nearly 9, further conditional grants or centrally established funds does whereas that of Kenya is just under 3, Zambia 2, and both Mali not support greater fiscal decentralisation, it presents one of and Ghana just above 1. the clearest routes by which sector funding can be managed and spending at the district level can be linked to national policy Sector expenditure is dominated by water, and within water objectives. towards development expenditures. While this is necessary for expanding services a key sector challenge remains water 7.2 External WASH financing point functionality, which, overall, is falling across Malawi. Budget support to Malawi has been severely reduced in Illustrating the point above, despite the relatively high overall recent years. With the withdrawal of budget support by some allocation to water, the low budget allocation to water ORT is traditional bilateral donors, overall fiscal space for government a cause for concern, as is the limited number of frontline staff has been significantly reduced. The result is that allocations, (WMAs). WMAs and DWDOs interviewed for the PER frequently even for small ORT budgets, are constrained. highlight the limited ORT allocations as a key issue. As Malawi moves towards universal access to basic services there will be The composition of external WASH financing has changed need for a re-focusing of expenditure towards maintaining and substantially. New ODA commitments are predominantly loans, upgrading services, as opposed to developing new infrastructure. as opposed to grants, and are channelled to the water boards Investments from GoM sources in maintaining services need to as the implementing agency. This elevates the importance of be considered in relation to spending by the water boards and good collaboration and coordination between the water boards, non-water board household expenditure. MoAIWD, district councils, and WUAs in service delivery. The new large commitments to the sector from the World Bank and GoM expenditure in sanitation is overwhelmingly dominated AfDB are centred on improving infrastructure in urban areas, by spending on frontline staff salaries57. In many ways, this raising some equity considerations. There are now few large is appropriate as the GoM approach to sanitation, as set forth externally funded programmes specifically targeting the rural in the National Sanitation and Hygiene Strategy 2018–24, relies sub-sector – where the majority of people are without access to predominantly on frontline staff conducting promotion activities. basic services, and where the poorest live. In the costed implementation plan for the strategy there are very few activities requiring development expenditures. Staff working Off-budget external funding through NGOs is likely to remain on sanitation in the national and district environmental health an important source of expenditure in the sector, though, in units have a wide range of responsibilities; this is especially the line with the trends in bilateral donor funding, this is also case with frontline staff (HSAs). Progress in sanitation is heavily projected to fall. This will have consequences for the overall level dependent on the extent to which these staff are well-resourced of development expenditure in the sector. However, a subtler and equipped to effectively do their work. As highlighted in impact is likely to be on the extent to which district-level frontline Sections 6.1.2 and 6.2.1 the ratio of frontline staff to population WASH staff have funding for their work. It is common for NGO- varies widely and is well above the established acceptable implemented programmes to pay allowances for frontline staff sector norms in Malawi. As for water, environmental health staff related to travel. Reductions in funding for these programmes is interviewed for the PER frequently highlighted the limited ORT likely to place further pressure on the limited GoM-funded ORT allocations as a key issue. budgets.
Allocation of most WASH resources is determined by central While most districts appear to have functional DCTs, most government. The result is that key district-level WASH staff districts report challenges with leading and coordinating (DEHOs and DWDOs) have very limited influence on the overall the work of donors and NGOs in the district. While some 57 It should be noted that the salary spend by the GoM on sanitation staff was calculated districts report satisfactory aid coordination, the view of many as a proportion of the total salary spend based on proportions reported by districts. Staff working in environmental health units both at the national and district levels have a diverse DWDOs and DEHOs is that some donors and NGOs design and set of responsibilities, meaning that ‘sanitation’ is not their only responsibility. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 50
implement WASH sector plans without satisfactory coordination household expenditure makes to maintaining services through processes. fees paid to WUAs. Community-based management and WUAs have a recognised place in policy, with the stated aim of these Other donor-financing models are possible, even without being to ‘empower the communities to own and manage the sector budget support. Section 5.2.4 described Malawi’s piped water supply systems in the market centres and rural areas important and innovative financing models in the health and on their own with minimum support from outside’. WUAs receive education sectors, which can be considered for the WASH sector. minimal support from the GoM, though the frontline district staff (WMAs) have a role in supporting the WUAs. It is also common 7.3 Water board expenditure and performance for NGOs working on water in the districts to engage and work with the WUAs. The analysis of sector expenditure highlights that the water boards account for a sizeable proportion of sector funding Section 6.1.2 outlined the importance of WUAs in maintaining – over 27.1% when including the household expenditure paid services in Malawi, as well as the challenges associated to water boards. This expenditure, and the fees collected from with the community-based management model in Malawi. households, is concentrated in urban areas. Furthermore, the Given the scale of non-water board household expenditure in analysis highlights that the growth in revenues has primarily the sector the lack of dedicated support to WUAs represents been driven by increases in prices, alongside an expansion in a key gap in policy; and leveraging this household expenditure services. through supporting WUAs to improve and professionalise service delivery represents a large opportunity for enhancing sector There is no regulator in Malawi: as per the Waterworks Act efficiency. In any case, such a large volume of sector financing 1995 it is the MoAIWD that regulates tariffs in the sector. deserves closer attention in policymaking. Specific possible Tariff rates are not widely publicised by either the water boards strategies include: more active monitoring of WUA performance or MoAIWD58. This has led to some complaints in the media by districts; support to improving governance arrangements and regarding the water boards imposing ‘secret’ tariff rises and a financial management of WUAs; dedicated capacity-building lack of transparency in pricing59. A further complexity regarding support on both of these aspects; and an investment in better the GoM management of the water boards is that the water linking frontline staff (WMAs) and area mechanics with WUAs. boards report their financial data to the Department of Statutory All of the above represent viable areas for investment by the Corporations in MoFEPD. GoM or donors, and in all cases the districts would have a central role in implementation. A common challenge in community- The loose regulatory environment, cross-ministerial based management models is that service delivery often responsibilities for water board oversight, and the recent becomes deeply rooted in local politics. A breakdown in intra- substantial water price rises point towards the need to community relations, or in relationships between the WUA and review tariff rates and policy, as well as the need for greater district authorities, can undermine progress. While there is no oversight of utility performance. The current tariff policy is easy answer to such challenges, clarifying the role of WUAs in relatively pro-poor and there is a substantial cross-subsidy policy and more clearly specifying processes for arbitration and between commercial and institutional rates and kiosk users. governance can contribute to resolving such challenges when However, the overall tariff policy of MoAIWD is not clear, either in they arise. policy documents or the Sector Performance Reports. MoAIWD has the legal mandate in this area and should be the lead agency There are already examples in Malawi of more formalised in reviewing and establishing appropriate tariff levels in the community-based management under the WUA model61. In short run. In the medium term the establishment of a regulatory Lilongwe all WUAs have a specified three- tiered organisational authority should be a key consideration when reviewing and structure, and there is a ban on politically affiliated individuals updating national policy. participating in the WUA management. In recent years the WUAs 7.4 Household expenditure in Lilongwe have signed service contracts with the water board that more clearly specify the responsibilities of both parties. As highlighted in Section 5.4, a large proportion of the The water board serves as the point of contact for customer household expenditure is spent on providers other than the complaints, providing an avenue for issues to be raised relating water boards60. This expenditure is potentially a ‘blind spot’ in to WUA performance. While this example does not provide a policymaking as these expenditures are not regularly tracked. blueprint for reform in policy it does provide a concrete example This non-water board household expenditure represents 16.8% of steps that can be taken to formalise the service delivery of funding to the sector – as much as two-thirds of GoM and functions of the WUAs. donor (ODA) expenditure combined. Of particular interest is the contribution this non-water board 61 See WaterAid (2016). 58 Current and historic rates are not published on the water board websites or by MoAIWD, and the water boards all stopped reporting to IBNET in 2014/15. 59 https://times.mw/blantyre-water-board-raises-tariffs-secretly-again/ 60 Including: fees paid to WUAs, expenditure on self-supply, expenditure on purchasing water from informal providers (non-water board), and expenditure on bottled water. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 51 PUBLIC EXPENDITURE REVIEW
7.5 Financing in emergencies environmental health departments, respectively; sanitation and hygiene ORT at district level, which is not separately identified Most emergency response activities are financed by within district-level IFMIS; some Development II WASH projects development partners. In the five years of the PER period, are not separately identified within the IFMIS at MDA level; and government finance for emergency response totalled only MWK individual projects under the CDF and DDF are not separately 68 million, about 0.5% of total GoM expenditures on the WASH coded within the district-level IFMIS. sector. The reliability of data from the district-level IFMIS is still DODMA coordinates the activities of development partners, limited, so WASH expenditure tracking is constrained. but not budgets. The DODMA WASH cluster activities are Indicators of limited reliability include consistently poor local known to be substantial, though they are not apparent in any authority audits results, as well as bank reconciliations not being GoM budget or expenditure reports. done and data not being entered into the IFMIS. Examples seen during this PER include: incomplete district data used by 7.6 WASH expenditure tracking and general PFM NLGFC for consolidating the annual results of all LAs; and PE processes that has been decentralised since 2017/18 has not been coded WASH budget allocations and expenditures, especially for to separate sectors (such as health and water). sanitation and hygiene, are not easily identifiable, and the IFMIS coding system that is currently used does not allow WASH officers do not and cannot use the IFMIS as a clear identification of all WASH expenditures. Whereas management information tool, meaning opportunities for some elements of WASH are clearly identified, such as the expenditure management are lost. This lack of access to and Water sector within district ORT and the Borehole Fund, other use of such financial management information by public sector elements of WASH cannot be separately identified from non- line managers is common in all sectors in Malawi. WASH expenditures. These include PE at both the MDA level and at the district level; ORT within MoAIWD and MoHP, for which there is no separate coding of water supply services and MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 52 © UNICEF/2012/Anthony Asael © UNICEF/2012/Anthony
8. RECOMMENDATIONS, WITH LESSONS LEARNT
RECOMMENDATION AREA 1: increased government • Allocation of most WASH resources is determined by central financing of WASH government.
Recommendations: RECOMMENDATION AREA 2: the use of conditional • Increase WASH ORT allocation from central government grants and funds for financing WASH services at • Lobby for enhanced budgetary decentralisation, so that district level. allocations between sectors of expenditures, such as ORT, can be decided at the local authority level. Recommendations: • The development of a targeted preventative health fund to Lessons learnt contributing to these recommendations: support sanitation and hygiene promotion may contribute • Government expenditure is a small proportion of total to increasing sector financing, following the example of the WASH expenditure. Nonetheless, nearly all funding to the Borehole Fund. sector (donor or government) relies on government staff to • There is a need for strong oversight of these funds by district implement programmes. councils or ministries, departments and agencies (MDA); • Despite the reliance on government staff for sector and there is currently a need to strengthen the oversight of performance, ORT transfers, which are essential for effective the implementation of the Borehole Fund. staff performance, are insufficient for WASH activities. • Government overall financing of the WASH sector is Lessons learnt contributing to these recommendations: significantly lower than that of other countries in sub- • Centrally determined conditional grants or funds can have a Saharan Africa, expressed as a percentage of GDP and as strong influence on sector expenditure. spending per capita. • Technical oversight of the use of the Borehole Fund (similar • WASH sector ORT is a small proportion of the total GoM to oversight of the CDF), needs to be enhanced in some WASH financing. As the government has limited fiscal districts. space, an increase in WASH ORT allocation might be the most effective use of limited resources. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 53 PUBLIC EXPENDITURE REVIEW
RECOMMENDATION AREA 3: enhanced identification Lessons learnt contributing to these recommendations: of GoM WASH expenditures. • There is a shortage of frontline staff in both the water and sanitation sectors. Recommendation: • Nearly all funding to the sector (donor or government) relies • Consider having ‘sanitation and hygiene’ sector (or on government staff to implement programmes. cost centre) at district level (as for water) to empower environmental health staff with more funds and more RECOMMENDATION AREA 6: adjusting to reductions attention to sanitation; and would also facilitate better in external funding. tracking of overall WASH expenditures. Recommendation: Lessons learnt contributing to this recommendation: • In the more constrained external funding environment, • WASH budget allocations and expenditures, especially for there is a need for increased donor and GoM coordinating sanitation and hygiene, are not easily identifiable, and the in prioritising remaining resources around ‘core’ sector IFMIS coding system that is currently used does not allow functions that need to be in place (including monitoring and clear identification of all WASH expenditures. oversight). • The reliability of data from the district-level IFMIS is still limited, so WASH expenditure tracking is constrained. Lessons learnt contributing to this recommendation: • WASH officers do not and cannot use the IFMIS as a • Malawi has substantially higher reliance on external management information tool, meaning opportunities for financing relative to domestic financing, compared to other expenditure management are lost. countries. • Budget support to Malawi has been severely reduced in RECOMMENDATION AREA 4: professionalising the recent years. The result is that allocations, even for small community-based management model. ORT budgets, are constrained. • The composition of external WASH financing has changed Recommendations: substantially. New ODA commitments are predominantly • Dedicated capacity-building packages should be developed loans, as opposed to grants, and are channelled to the water to support WUAs in service delivery. boards as the implementing agency. • MoAIWD should lead in providing clearer policy guidance on • Off-budget external funding through NGOs is likely to remain their governance structures and links to the formal sector an important source of expenditure in the sector, though, in (water boards or district councils). line with the trends in bilateral donor funding, this is also • Where appropriate, WUA service delivery functions should projected to fall. be more clearly linked to the service delivery functions of • The new large injections of external resources to the the water boards or district councils. sector that are channelled to water boards underscores the importance of effective sector coordination between the Lessons learnt contributing to these recommendations: water boards, MDAs, and donors. • A large proportion of the household expenditure is spent on providers other than the water boards, especially WUAs. RECOMMENDATION AREA 7: adoption of stronger • WUAs are important in maintaining services in Malawi, but SWAp processes in the WASH sector. there are challenges associated with the community-based management model in Malawi. Recommendation: • Investing in WUA capacity is likely to contribute to improved • It is recommended that stronger SWAp processes be sector outcomes on functionality if it means non-water adopted both centrally and at district level, including an board household expenditure is spent more effectively in added emphasis on aid coordination. This approach could the sector. include SWAp funding, preferably at district level, with • There are already examples in Malawi of more formalised special fiscal controls. community-based management under the WUA model. Lessons learnt contributing to this recommendation: RECOMMENDATION AREA 5: sufficiency of frontline • While most districts appear to have functional DCTs, most staff. districts report challenges with leading and coordinating the work of donors and NGOs in the district. Recommendations: • Other donor-financing models are possible, even without • New recruitment of frontline staff should be prioritised in sector budget support. The health and education sectors are those districts with the greatest staff deficit per population already adopting innovative approaches that can be mirrored and in relation to service levels. for the WASH sector. The use of stronger SWAp processes can facilitate higher efficiency and effectiveness in the use of donor and NGO resources. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 54
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The National Budget runs from the 1st of July to the 30th ANNEX A - DETAILS OF of June each year. Budget preparation starts in March with the circulation of the budget guidelines and indicative Medium- THE BUDGET CYCLE Term Expenditure Framework (MTEF) ceilings. Ministries, Departments and Agencies (MDAs) are then expected to submit The Third Malawi Growth and Development Strategy (MGDS) their line-by-line budgets in April and budget hearings are held, III (2017-2022) and the Vision 2020 provide the country’s after which the final MTEF ceilings are circulated. Final budget medium and long-term objectives and set the overarching submissions from MDAs and the budget consolidation take strategy to be implemented through the national budget. place in early May. Parliamentary approval is in June or July. In addition, there is a Public Sector Investment Program (PSIP) which is a five-year rolling plan that outlines development Figure 45 provides details of the activities that take place in each priorities in infrastructure development. The annual process is phase, and the table overleaf outlines the key elements within divided in five key phases: policy development; MTEF/budget the GoM budget. preparation; budget implementation and control; accounting and monitoring; and evaluation and audit.
IGURE
POLICY DEVELOP ENT
Vision 2020 MDGs / SDGs Sector policy and strategies
TE BUDGET OR ULATION
Macroeconomic forecasts EVALUATION AND AUDIT Fiscal and budget framework T TE Development of ministerial / Evaluation by central and sector proposlas ministerial M&E units Allocation between sectors Audit by National Audit Office and MDAs Oversight by national assembly B C Budget documentation Budget approval by national assembly
ACCOUNTING AND ONITORING BUDGET I PLE ENTATION Capturing expenses in AND CONTROL accounting system Collection of revenue Recording and use if management Cash management rules information on outputs Cash allocation and release Internal audit of funds Management of services and human resources Procurement
S Authors’ own design MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 56
Key features of the budgeting system in Malawi include: Expenditure management processes for each expenditure element are:
• Mid-year reallocations of budgets (virements) can be sought • PE expenditure: all government employees are paid direct and a mid-year revised budget is presented to Parliament to their bank accounts from the Reserve Bank of Malawi for approval. (RBM). Payments are recorded in the GoM salaries • Programme-based budgeting (PBB) was introduced in software overseen by the Department of Human Resources 2014/15 with six pilot Ministries/Votes. In 2015/16, it was and Management Development (DHRMD). DHRMD has increased to 13 Votes and in 2016/17 it was rolled out to oversight over new employees, promotions and departures all MDAs. With PBB, the Government of Malawi aims to and also over the establishment of new positions. increase the focus on results in the budget, linking each PE budgets at local authority level used to be under the direct strategic objective to one programme. control of the sector ministries but they are now devolved to • In 2016/17, the Office of the President and Cabinet instituted local authorities in that data entry in the DHRMD controlled Performance Contracts which MDAs are expected to adhere human resource management information system (HRMIS) to and report on at the end of the financial year. software is done at authority level. However, funding is still from the centre and DHRMD still retains control, • The budget cycle at districts (local authorities) follows a with authorities not yet authorised to make ‘hire and fire’ similar process. The National Local Government Finance decisions themselves. Committee (NLGFC) has a role in developing formulae used to calculate budget allocation of sectoral totals between • ORT expenditure: ORT is funded by Treasury as a lump each authority. sum each month against an annual budget total, for each cost centre bank account (e.g. a ministry HQ). The monthly Laws guiding expenditure control include the Public Financial funding should follow the monthly cash-flow set at the time Management Act (PFMA, 2003), the recently updated Public of the budget (though variances are common). Management Procurement and Disposal of Assets Act (2017) and the Public at the cost centre decides on allocations within the ORT Audit Act (2008). funding received in each month. They are guided by the annual budget ORT line items. Accounting is carried out by the ‘accounting common • At local authorities, NLGFC is involved with ORT only to the service’, a cadre of individuals ranging from accounting assistants extent that they are the ones that inform the authority how up to directors of finance. All are under the oversight of the much funding was sent. The money is credited to a cross- Accountant General, who allocates staff to each MDA. These sectoral ORT bank account at the authority. Payments from officers are expected to apply formal accounting and control this account are signed by the District Commissioner (DC) procedures as set out in Desk Instructions. and the Director of Finance (DoF). Payments are authorised by the director of the relevant sector. The Integrated Financial Management System (IFMIS) is the accounting software that facilitates budgetary control. The • Development expenditure: development expenditure is Accountant General oversees its operation at the national level, generally funded by Treasury against each evidenced stage with terminals for IFMIS access and transaction entry distributed in a project’s activity. In this way, funding is provided to cost around MDAs. IFMIS serves as a control mechanism to ensure centres only when needed. that payments do not exceed the respective budget lines. The above expenditure management description applies to A different version of IFMIS operates at local authorities. Government expenditures in each sector, including WASH The software at local authorities is substantially different, expenditures. though coding is largely consistent. Accounting officers at that level recently ceased to be part of the common service due to progress in decentralisation. Instead, the NLGFC has oversight over PFM at local authorities. There are also separate local authority accounting guidelines which cover IFMIS operation and also local revenue collection (e.g. property rates and market fees) as well as controls over the use of this revenue. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 57 PUBLIC EXPENDITURE REVIEW
ANNEX B - OVERVIEW OF KEY WASH SECTOR LEGISLATION, POLICY, AND STRATEGY
TABLE 25 Key legislation relevant to the WASH sector
Legislation Summary Public Health Act 1949 • Gives powers to Sanitation inspectors to enforce sanitation and hygiene in all places both public and private • Regulates implementation of sanitation and hygiene • Sets out procedures of prosecuting Waterworks Act 1995 • Created the Water Boards and gave them power to collect revenues, as well as outlining service delivery responsibilities. Environment • Gives powers to the minister to prescribe environmental quality standards generally (inc. noise, air, Management Act 1996 water, soil, effluent and solid waste) • States that every person shall have a right to a clean and healthy environment Local Government Act • 2.(1) d. grants various powers and responsibilities related to water and sanitation in an Assembly/ of 1998 councils jurisdiction. • 13.(4) grants powers to collect revenue from water supplies and waste collection. Environment • Gives powers to the minister to prescribe environmental quality standards generally (inc. noise, air, Management Act 1996 water, soil, effluent and solid waste) • States that every person shall have a right to a clean and healthy environment Water Resources Act • Repeals the 1969 Water Resources Act 2013 • Establishes the National Water Resources Authority • Defines arrangements surrounding water governance
TABLE 26 Key sector policies
Policy Details The National • Devolves administration and political authority to the district level; Decentralization Policy • Integrates governmental agencies at the district and local levels into one administrative unit 1998 • Assigns, functions and responsibilities to the various levels of government (including for Water and Sanitation) National Water Policy • Outlines the overall policy goals in the water sector across key areas. 2005 • Outlines M&E arrangements in the sector. • Clarifies institutional responsibilities. • Sets specific objectives up until 2010. The National Sanitation • Outlines overall policy goals in the sector, and discusses key strategies. Policy 2006 • Discusses implementation arrangements at the various institutional levels. • Outlines a sanitation investment plan up to 2011. National Environmental • Sets out the priority areas of: Health Policy 2018 • Promote hygiene at household level. • Promote provision of sustainable sanitary facilities. • Promote the use of sustainable sanitation technologies. • Promote proper management of liquid and solid waste at all levels • Promote Open Defecation Free (ODF) communities. • Strengthen water quality monitoring from source to user-end. • Strengthen water treatment at point of use. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 58
TABLE 27 Key sector strategies
Strategy Details Vision 2020 • The policy framework that “sets out a long-term development perspective for Malawi”. Malawi Growth • Outlines the national development priorities 2011-16. Development Strategy II • Water development features under Sub-theme 3, and key priority area 7.2. Sanitation features under - 2011 – 2016 (MGDS II) key priory area 5.2. • Estimated budget allocations by priority area are provided. • Some specific activities are outlined related to WASH by clear targets not set. Malawi Growth • Outlines the national development priorities 2017-22. Development Strategy • Water development features under key priority area 6.2. Sanitation features under priority area 6.6 III - 2017 – 2022 (MGDS (health and population). III) • Outlines flagship government projects. • As with MGDS II some specific activities are outlined related to WASH by clear targets not set. National Open • The strategy aims to align, synchronise and harmonize sanitation and hygiene initiatives and Defecation Strategy – interventions towards meeting the goals of the Malawi Growth and Development Strategy (MGDS) II 2011-15 • Set the overall goal of Malawi being ODF by 2015. • Outlined key approaches including scaling up CLTS, and increasing the use of Sanitation Marketing. National Health Sector • Includes some mention of health promotion to prevent communicable diseases (Section 5.2.3.2 – Strategic Plan (2011 – Environmental Health, and a recognition of poor sanitation as a leading risk factor. 2016) • Outlines promotion activities at the primary health care level as the key strategy under the HSSP 2011-16) National Health Sector • Reducing environmental risk factors more clearly identified as a key objective (see section 5.2, Strategic Plan (2017 – Objective 2). 2022) • A wider range of activities are included under a Water and sanitation strategy area, including water quality monitoring and training extension workers in CLTS. Malawi Water Sector • Outlines the water sector investment needs up to 2030 modelled under a range of coverage scenarios. Investment Plan • Identifies priority policy and spending areas in the WASH sector as well as identifying institutional issues. National Sanitation And • Comprehensive strategy covering rural and urban sanitation and hygiene. Hygiene Strategy - 2018 • Clear and measurable targets set across key areas. - 2024 • Outlines strategies for: • Providing and promoting use of improved and accessible sanitation facilities in all public places • Promote adoption of safe water and sanitation practices at individual and household levels • Improving management and disposal of both liquid and solid waste. • Ensure that programs incorporate promotive approaches that is cognisant of context, technology, behavioural science and economics for improved sanitation and hygiene. Malawi Education • Plan makes on specific mention of water of sanitation in schools. Sector Plan: a statement 2008-2017 National Resilience • Strategy initiated outside of PER timeframe as such will be considered in looking forward. Strategy (Phase I – 2018- • Strategy references existing relevant WASH sector policy. 2030) • Focus in the WASH sector relates to drought resilience, protecting watersheds and flood control. • WASH outcomes included under Pillar 3. • Sanitation included with CLTS highlighted as the approach to be used. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 59 PUBLIC EXPENDITURE REVIEW
TABLE 28 Key sector institutions, their responsibilities, and functions
Institution Roles and responsibilities Ministry of Agriculture, • The MoAIWD has 7 key departments of which Water and Irrigation is one. The Water and Irrigation Irrigation and Water department breaks into three technical departments: Development (MoAIWD) • Water Resources Management and Development • Water Supply Services, • Irrigation Services • The overall mandate of the MoAIWD Water and Irrigation department is to: ‘To ensure that water resources are well managed to meet domestic, agricultural and industrial demands as well as improve access to improved sanitation facilities and adoption of safe hygiene practices’ Ministry of Local • The MLGRD is responsible for supporting sector ministries to reform their systems in line with Government and Rural decentralisation and support district government to adopt their devolved functions. Development (MLGRD) Ministry of Health and • The overall goal of MoHP is to improve the health status of all Malawians. Regarding WASH this population (MoHP) includes: • Promotion of sanitation and hygiene in all places using CLTS, SLTS, PHAST and Sanitation marketing • Enforce laws related to sanitation and hygiene (CAP34:01 sections 59-114) • Promote household water treatment • Provide leadership and oversight of sanitation and hygiene activities at all levels • Formulate and revise policies related to sanitation and hygiene • Maintaining WASH data bases at all levels • Developing standard for sanitation and hygiene in liaison with key stakeholders • Responsibilities include environmental sanitation and hygiene. The health sector strategy outlines a role for the MoHP in promoting sanitation through community Led Total Sanitation (CLTS). Ministry of Education, • Responsible from education from primary through to tertiary. With the MOEST the Department of Science and Technology School Health and Nutrition is responsible for scaling up school health and nutrition programs in schools across the country National Water • The Water Resources Act 2013 announced the establishment of this authority, but it appears it has Resources Authority yet to be operationalised. Its functions as outlined in the Act were performed by the Water Resources (NWRA) / Water Board for the period under review. While the operationalisation of the NWRA is still underway the Resource Board functions of the WRB include: • Advising on policy related to water abstraction; • Managing applications for water abstraction and effluent discharge Water Boards • The five Water Boards are mandated to “provide adequate supply of wholesome water and quality services to urban areas in an efficient and effective manner”. They are managed under the MoAIWD and there is no regulator in Malawi. District Councils • District Councils have responsibility for delivering water and sanitation services in their area. The District Water development Officer (DWDO) is the main permanent institution whose mandate is to provide direct support for O&M (outside of the Water Boards in Urban areas). The health department lead on sanitation and hygiene promotion – led by the District environmental Health Officer (DEHO) with EHOs and Health Service Assistants (HSAs) acting as the frontline staff. Water Users • Beyond the District Councils and the Water Boards the WUAs are recognised in policy as having Associations responsibility for the O&M of water systems – under the umbrella of community-based management (CBM) of water supplies. These are not governmental institutions but community-based institutions. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 60
ANNEX C - MAPPING OF KEY DONOR PROJECTS
TABLE 29 Key externally financed projects 2012-2018
Water/ Implementing Donor Project Years Cost (millions) Urban/rural Sanitation partners
Water Board Lilongwe Water and Sanitation Project 2017-2023 USD 100 Urban Both (Govt.)
World MoAIWD lead Shire basin management project 2012-2018 USD 136 Unspecified Both Bank (Govt.)
Second National Water Development MoAIWD lead 2012-2015 USD 189 Unspecified Both Project (Govt.)
Malawi shire valley irrigation project Approved 2017 UAC 0.5 Unspecified Both Unknown
Nkhata bay town water supply and Approved late Unspecified – Water Board UAC 22.5 Both sanitation project 2018 assumed Urban (Govt.)
Sustainable rural water and sanitation UAC 25.6 AfDB infrastructure for improved and health Approved 2013 Rural Both MoAIWD +UAC 2.6 and livelihoods
Mzimba integrated urban water and Water Board Approved 2015 UAC 16.4 Urban Both sanitation project (Govt.)
Lilongwe sustainable water supply and Pipeline UAC 190 Urban Both Unknown sanitation service delivery
Improving Water Supply, Sanitation and Hygiene Promotion in Peri-Urban 2014-2017 EUR 0.9 Urban Both Unknown Areas of Mzuzu and Karonga Town.
Integrated WASH intervention in low Dutch Red Cross 2014-2017 EUR 1.7 Urban Both income areas in Mzuzu and Karonga (NGO) EU Peri-Urban Sanitation and Hygiene 2013-2017 EUR 1.66 Urban San only Plan (NGO) Project in Mzuzu City
‘Water Fund’* 2013-2018 EUR 23 Rural Both UNICEF
Malawi Water and Sanitation DFID 2012-2016 GBP 19.5 Rural Both UNICEF Programme
The Accelerated Sanitation and Plan (NGO) and GSF Hygiene Practices Programme 2012-2017 USD ~7.5 Rural San only local NGOs (ASHPP) Funding was to Supporting Malawi’s National Water DFAT 2010-2012 USD 17m Unspecified Both extend AfDB Development Program programme WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 61 PUBLIC EXPENDITURE REVIEW
ANNEX D - TECHNICAL NOTE ON THE USE OF JMP AND SURVEY DATA
When using any one survey to assess the level of WASH access producing the global estimates the JMP assume a proportion great care has to be used in setting these in context of other of all latrines to be unimproved63. This explains why the JMP surveys and comparing to trends and the JMP data, especially estimates can differ from those reported by individual surveys. as: The proportion of latrines that the JMP assume to be i. the JMP estimates are based on regressions and the JMP unimproved has a very significant influence on the estimates apply assumptions to the estimates from individual surveys; they produce for Malawi. Between the 2017 and 2019 data ii. individual surveys can suffer from measurement error and/ release these assumptions were revised and led to the JMP or present anomalous results. These may only be apparent substantially revising down their coverage estimates for basic in light of following surveys. sanitation. The PER team downloaded the country data file for Malawi prior to and then after the 2019 data release. This allows Regarding point ii) this can be associated with ‘non-sample a comparison of how the revised assumptions used by the JMP error’ related to training and implementation of the survey. impact on the figures for improved and basic sanitation. Figure Such errors are very hard to identify after the fact as these are 46 presents the JMP estimates of the same surveys across the not measurable. However, the PER team note that between the two different periods; the differences shown in the estimates 2010 and 2016 DHS there was a very large increase in the number are purely due to JMP methodology changes and changes in the of people with improved sanitation. The 2018 census confirms assumptions. the level of coverage is similar to the 2016 DHS; however the 2008 census presents much higher latrine coverage. In short, Given the challenges unique to Malawi is in estimating the latrine data of the 2010 DHS are seen likely to suffer from ‘improved’ sanitation regarding the classification of latrines measurement error and as such are not used. Rather, where with a mud or wood slab the PER team avoid using this possible the team use ‘harder’ indicators such as the level of classification in presenting the results of our own analysis. open defecation when analysing progress on sanitation. Instead, where latrine data needs to be presented the team present this as ‘improved and traditional latrines’. Where A further critical issue in using survey data relates to the ‘traditional latrines’ refers to those with a wood/mud/rock slab. classification of latrines as either ‘improved’ or ‘unimproved’ This change in language reflects the fact that we do not assume in line with the global monitoring definitions62. This can pose a proportion of these latrines to be unimproved; though at the a challenge for using survey data for the global estimates or for same time we recognise that all may not be of a high standard using survey data to estimate ‘improved’ sanitation. The issues and refrain from classifying all latrines with a wood/mud/rock in Malawi is that the vast majority of latrines in rural areas are slab as ‘improved’. simple pit latrines with a mud/wood slab. As per the global definition these appear to be improved facilities. However, in 63 The reason for this is not explicitly put forward by the JMP in report results. However, it is assumed by the evaluation team that the decision to do this likely relates to quality concerns around these latrines and considerations in ensuring the comparability of results 62 See WHO/UNICEF JMP (2018). between counties MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 62
IGURE P
BASIC SANITATION URBAN BASIC SANITATION RURAL 2017 data release / estimates 2017 data release / estimates
100 DHS16 100 WMS11 IHPS13 WMS09 DHS00 CWIO02 IHS04 MICS08 80 MIS14 80 DHS04 MIS12 DHS16
DHS10 MICS14 WMS11 WMS14 WMS08 WMS14 WMS09 IHPS13 CEN08 IHS11 WMS08 60 60 CWIQ02 MICS06 DHS10 CEN06 MICS14 DHS00 IHS11 40 40 MIS14 MIS12
20 20
0 0 2000 2005 2010 2015 2000 2005 2010 2015
BASIC SANITATION URBAN BASIC SANITATION RURAL 2019 data release / estimates 2019 data release / estimates 100 100
80 80
WHS12 WMS09 WMS11 DHS04 MIS12 60 CEN08 DHS16 60 WMS14 DHS00 CWIQ02 IHS04 MICS06 WMS06 IHS11 IHPS13 MIS14 DHS10 MICS14 WMS11 40 40 WMS09 DHS16 MIS14 CEN08 CWIQ02 DHS04 DHS10 MICS08 WMS08 MIS12 DHS00 IHS04 20 20 MICS14 IHS11 IHPS13
0 0 2000 2005 2010 2015 2000 2005 2010 2015
Improved data points Basic estimates Improved estimates S Hutton and Varughese (2016) WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 63 PUBLIC EXPENDITURE REVIEW
ANNEX E - DISTRICT LEVEL PROGRESS DATA TABLES
The tables in this annex present the data used in the performance analysis. The data are presented disaggregated in two ways. In the ‘district only’ columns the data is for the whole district (including the cities within that district). In the ‘districts and cities’ columns the data for the major cities within those districts are presented separately and the figures for the rest of the districts exclude the city figures.
TABLE 30 Access to an improved drinking water source by district and region (2010-2018)
Areas Districts only Districts and cities 2010 2013 2015 2018 2018 2013 (MICS) (DHS) (MICS) (DHS) (Census) (Census) Malawi 80 86 87 85 86 85 Northern 83 90 87 83 90 83 Chitipa 77 85 88 80 85 80 Karonga 87 88 90 89 88 89 Nkhata Bay 74 75 77 75 75 75 Rumphi 86 91 83 76 91 76 Mzimba 85 95 89 86 94 83 Likoma 88 88 Mzuzu City 100 95 Central 74 84 86 84 84 84 Kasungu 64 73 82 72 73 72 Nkhotakota 77 85 85 80 85 80 Ntchisi 83 85 82 85 85 85 Dowa 70 75 66 78 75 78 Salima 91 93 86 90 93 90 Lilongwe 74 90 92 89 86 85 Mchinji 72 77 87 88 77 88 Dedza 66 86 84 83 86 83 Ntcheu 86 83 97 81 83 81 Lilongwe City 99 96 Southern 84 87 88 87 87 87 Mangochi 82 93 93 89 93 89 Machinga 78 80 74 80 80 80 Zomba 91 93 91 93 92 93 Chiradzulu 89 90 94 93 90 93 Blantyre 90 91 90 92 79 87 Mwanza 85 90 92 86 90 86 Thyolo 67 66 81 75 66 75 Mulanje 91 88 91 86 88 86 Phalombe 91 91 87 90 91 90 Chikwawa 74 92 87 87 92 87 Nsanje 92 87 89 86 87 86 Balaka 89 95 93 92 95 92 Neno 80 74 71 77 74 77 Zomba City 95 96 Blantyre City 99 95 MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 64
TABLE 31 Open defecation rates by district and region (2010-2018)
Areas Districts only Districts and cities 2010 2013 2015 2010 2013 2018 (DHS) (MICS) (DHS) (DHS) (MICS) (Census) Malawi 11 5 6 7 5 7 Northern 14 4 7 6 4 6 Chitipa 6 2 2 1 2 1 Karonga 27 3 8 7 3 7 Nkhata Bay 17 6 8 7 6 7 Rumphi 5 1 2 4 1 4 Mzimba 14 4 8 7 5 9 Likoma 8 8 Mzuzu City - 1 Central 12 4 5 7 4 7 Kasungu 17 4 6 6 4 6 Nkhotakota 21 5 3 11 5 11 Ntchisi 8 3 4 5 3 5 Dowa 10 6 4 6 6 6 Salima 20 9 7 7 9 7 Lilongwe 10 2 4 7 4 10 Mchinji 11 9 11 13 9 13 Dedza 11 3 6 8 3 8 Ntcheu 2 2 2 8 2 8 Lilongwe City - 1 Southern 9 6 7 7 6 7 Mangochi 10 4 6 4 4 4 Machinga 8 6 10 8 6 8 Zomba 8 3 11 6 3 7 Chiradzulu 2 2 4 8 2 8 Blantyre 3 2 3 3 4 7 Mwanza 10 9 8 6 9 6 Thyolo 6 4 10 9 4 9 Mulanje 14 10 4 9 10 9 Phalombe 16 9 4 7 9 7 Chikwawa 17 12 14 11 12 11 Nsanje 20 16 14 16 16 16 Balaka 9 7 3 5 7 5 Neno 18 7 7 9 7 9 Zomba City 0 Blantyre City 0 0 WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 65 PUBLIC EXPENDITURE REVIEW
TABLE 32 Access to an improved or traditional latrine by district and region (2010-2018)
Areas Districts only Districts and cities 2010 2013 2015 2010 2013 2018 (DHS) (MICS) (DHS) (DHS) (MICS) (Census) Malawi 14 62 83 63 62 63 Northern 8 86 84 63 86 63 Chitipa 6 73 97 63 73 63 Karonga 4 90 83 66 90 66 Nkhata Bay 10 61 65 59 61 59 Rumphi 10 97 92 69 97 69 Mzimba 10 90 86 62 90 56 Likoma 57 57 Mzuzu City 97 85 Central 15 78 83 62 78 62 Kasungu 5 82 71 64 82 64 Nkhotakota 9 95 88 55 95 55 Ntchisi 7 97 87 60 97 60 Dowa 12 61 81 61 61 61 Salima 13 57 82 64 57 64 Lilongwe 27 97 85 67 95 56 Mchinji 8 83 68 57 83 57 Dedza 12 61 90 51 61 51 Ntcheu 11 22 91 59 22 59 Lilongwe City 100 87 Southern 14 44 82 63 44 63 Mangochi 11 27 87 62 27 62 Machinga 13 56 77 58 56 58 Zomba 19 71 71 64 68 60 Chiradzulu 5 22 89 57 22 57 Blantyre 32 62 94 78 46 63 Mwanza 8 37 76 66 37 66 Thyolo 8 19 78 58 19 58 Mulanje 9 20 84 64 20 64 Phalombe 7 58 85 57 58 57 Chikwawa 5 47 75 58 47 58 Nsanje 4 44 75 54 44 54 Balaka 14 32 82 62 32 62 Neno 3 49 89 61 49 61 Zomba City 92 91 Blantyre City 72 87 MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 66
IGURE D
20
Mchinji
20 I Thyolo Blantyre I
20
Neno Zomba Chiradzulu Dowa Central Southern City Karonga Zomba Region Region Phalombe A Nsanje 8 6 4 2 0 Mulanje 2 4 Lilongwe Ntcheu Ntchisi Kasungu Salima Lilongwe City Balaka Mangochi Dedza Mwanza Malawi 5 Chitipa Nkhotakota Blantyre Northern City Chikwawa Region Mzuzu City 10 W Mzimba Nkhata Bay
Machinga 15 Rumphi Percentage point change in access to improved water (2013-2018) water in access to improved point change Percentage
20 Percentage point change in open defecation rate (2013-2018) O W I
S MICS 2013 and census 2018
ANNEX F - HOUSEHOLD EXPENDITURE ESTIMATES BY DISTRICT
The analysis in this PER has highlighted that household interpolation between the surveys. The survey data are publically expenditure is a very significant proportion of total sector available: expenditure. The household estimates were produced based on expenditure surveys: the Integrated Household Survey 3 and 4. • IHS 3: https://microdata.worldbank.org/index.php/ In these surveys households report the expenditure on certain catalog/1003 [accessed October 2019] items in the previous month. Water expenditure is reported in • IHS 4: https://microdata.worldbank.org/index.php/ questions F37 in the surveys and soap reported in I05 and I06. catalog/2936 [accessed October 2019]
The analysis of the raw data was done by the authors. The estimates use the population weights reported in the survey. The estimated number of households is based on a linear WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 67 PUBLIC EXPENDITURE REVIEW
TABLE 33 Household water expenditure estimates 2016 (IHS 4)
Estimated annual Mean monthly Number of household Area expenditure Standard Error 95% confidence interval HHs* expenditure (MWK) (MWK) lower band upper band Malawi 777 43 693 861 3,766,571 35,139,643,304.42 - Urban 3,113 214 2,692 3533.556 602,651 22,511,865,559 Rural 228 19 191 264.4466 3,163,920 8,649,225,756 - North 925 108 713 1,137 445,485 4,944,979,354 Central 685 56 5 74 795 1,609,631 13,222,573,033 Southern 837 71 697 977 1,711,455 17,187,740,761 - Chitipa 117 64 -9 243 47,102 66,039,863 Karonga 528 272 -6 1,062 71,098 450,534,261 Nkhatabay 438 165 114 763 49,890 262,328,892 Rumphi 784 337 123 1,446 44,711 420,869,051 Mzimba 344 186 -21 708 184,844 762,101,631 Likoma 1,883 171 1,548 2,219 2,711 61,262,896 Mzuzu City 3,438 408 2,638 4,238 45,129 1,861,822,272 Kasungu 221 103 19 423 169,003 447,325,162 Nkhotakota 263 77 111 414 76,171 240,070,995 Ntchisi 152 71 11 292 65,826 119,785,999 Dowa 187 62 66 308 164,854 370,253,841 Salima 287 122 48 526 99,430 342,384,394 Lilongwe 411 130 157 666 362,092 1,787,135,627 Mchinji 791 94 608 975 126,957 1,205,791,800 Dedza 83 29 26 140 185,433 185,292,317 Ntcheu 148 77 -3 300 146,176 259,995,713 Lilongwe City 2,947 315 2,329 3,566 213,689 7,557,827,299 Mangochi 287 115 62 513 238,650 822,802,557 Machinga 798 111 581 1,016 154,077 1,476,214,337 Zomba Non-City 323 87 151 494 170,122 658,381,241 Chiradzulu 85 12 62 109 86,422 88,576,661 Blantyre 305 112 85 525 104,060 380,499,969 Mwanza 234 86 64 404 28,527 80,018,345 Thyolo 72 25 24 120 167,190 144,444,717 Mulanje 162 73 19 305 153,006 297,932,749 Phalombe 58 11 36 80 94,089 65,645,801 Chikwawa 167 80 11 324 120,810 242,827,454 Nsanje 153 71 14 291 61,515 112,593,568 Balaka 600 127 350 850 96,125 691,707,464 Neno 83 17 50 116 30,113 29,983,615 Zomba City 2,225 399 1,441 3,009 23,729 633,552,769 Blantyre City 4,344 468 3,425 5,264 183,019 9,541,192,984
Source: Authors’ analysis of IHS 4 data *the number of households is based on a linear interpolation between the two censuses MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 68
TABLE 34 Household water expenditure estimates 2010 (IHS 3)
Estimated annual Mean monthly household Area expenditure Standard error 95% confidence interval Number of HHs expenditure (MWK) (MWK) lower band upper band Malawi 158 14 131 186 3,111,328 5,914,306,456 - Urban 863 93 680 1,046 497,812 5,153,957,081 Rural 28 6 16 40 2,613,515 884,290,285 - North 119 16 88 150 364,814 520,185,961 Central 130 18 96 165 1,299,495 2,031,788,709 Southern 194 25 144 244 1,447,019 3,360,374,487 - Chitipa 61 36 -10 133 39,427 29,095,378 Karonga 146 61 26 266 59,533 104,432,550 Nkhatabay 51 27 -2 104 43,394 26,708,539 Rumphi 126 54 20 232 37,662 56,936,465 Mzimba 2 2 -2 6 150,811 3,314,470 Likoma 2,168 - Mzuzu City 793 119 559 1,027 31,819 302,683,519 Kasungu 53 42 -30 135 136,962 86,322,081 Nkhotakota 67 46 -23 157 64,988 52,375,693 Ntchisi 37 36 -34 108 51,284 22,970,642 Dowa 98 69 -36 233 130,660 154,230,050 Salima 37 19 1 74 81,047 36,381,915 Lilongwe 51 43 -34 135 293,662 178,058,582 Mchinji 52 46 -38 142 103,432 64,745,704 Dedza 16 11 -5 37 153,721 29,615,762 Ntcheu 67 28 13 122 119,783 96,586,224 Lilongwe City 639 116 411 866 163,956 1,257,016,009 Mangochi 18 13 -7 44 195,983 43,179,019 Machinga 40 28 -16 95 123,782 59,090,806 Zomba Non-City 29 5 20 39 147,447 52,166,884 Chiradzulu 95 46 5 186 74,036 84,695,504 Blantyre 50 24 3 96 86,351 51,344,128 Mwanza 91 44 4 179 23,071 25,268,728 Thyolo 41 18 6 77 146,448 72,923,178 Mulanje 23 11 0 45 131,581 36,050,709 Phalombe 48 25 -1 97 79,813 46,239,549 Chikwawa 20 11 -1 41 101,639 24,162,443 Nsanje 22 11 0 44 54,142 14,301,254 Balaka 64 20 25 103 79,775 61,363,878 Neno 15 4 8 22 25,981 4,659,970 Zomba City 845 130 590 1,100 19,939 202,237,076 Blantyre City 1,223 228 777 1,670 157,032 2,305,404,160
Source: Authors’ analysis of IHS 3 data *the number of households is based on a linear interpolation between the two censuses WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 69 PUBLIC EXPENDITURE REVIEW
TABLE 35 Household soap expenditure estimates 2016 (IHS 4)
Area Mean monthly Estimated annual Number of expenditure Standard error 95% confidence interval household expenditure HHs* (MWK) (MWK) lower band upper band Malawi 875 10 854 895 3,766,571 39,529,722,388 - Urban 1,369 35 1,300 1,439 602,651 9,902,389,734 Rural 758 10 739 777 3,163,920 28,784,570,680 - North 1,016 20 978 1,055 445,485 5,433,881,226 Central 921 18 886 955 1,609,631 17,782,035,618 Southern 803 14 776 830 1,711,455 16,487,799,561 - Chitipa 843 27 791 895 47,102 476,357,650 Karonga 1,034 46 944 1,125 71,098 882,424,580 Nkhatabay 1,134 66 1,004 1,265 49,890 679,191,741 Rumphi 971 47 879 1,062 44,711 520,875,629 Mzimba 928 39 851 1,004 184,844 2,057,457,914 Likoma 1,148 56 1,038 1,258 2,711 37,356,268 Mzuzu City 1,170 55 1,063 1,278 45,129 633,862,777 Kasungu 948 56 838 1,057 169,003 1,921,707,376 Nkhotakota 967 52 865 1,068 76,171 883,694,266 Ntchisi 940 48 846 1,035 65,826 742,840,230 Dowa 836 46 74 7 926 164,854 1,654,797,924 Salima 707 43 622 792 99,430 843,622,134 Lilongwe 814 35 74 6 883 362,092 3,538,927,308 Mchinji 862 40 785 940 126,957 1,313,691,658 Dedza 656 45 568 74 5 185,433 1,460,806,203 Ntcheu 693 50 595 791 146,176 1,215,516,906 Lilongwe City 1,544 72 1,402 1,686 213,689 3,958,871,077 Mangochi 736 39 659 814 238,650 2,108,719,847 Machinga 784 57 673 895 154,077 1,449,856,932 Zomba Non-City 802 51 703 901 170,122 1,637,159,783 Chiradzulu 660 28 605 715 86,422 684,142,645 Blantyre 951 52 849 1,053 104,060 1,187,391,240 Mwanza 727 44 642 813 28,527 248,965,297 Thyolo 650 42 568 732 167,190 1,303,683,352 Mulanje 621 41 541 701 153,006 1,140,047,357 Phalombe 445 25 397 494 94,089 502,809,260 Chikwawa 578 40 500 657 120,810 838,457,761 Nsanje 560 52 458 662 61,515 413,366,596 Balaka 804 57 692 917 96,125 927,968,603 Neno 734 42 652 816 30,113 265,278,965 Zomba City 1,433 135 1,167 1,698 23,729 407,979,289 Blantyre City 1,414 50 1,315 1,513 183,019 3,106,110,087
Source: Authors’ analysis of IHS 4 data *the number of households is based on a linear interpolation between the two censuses MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 70
TABLE 36 Household soap expenditure estimates 2010 (IHS 3)
Mean monthly Estimated annual Number of Area expenditure Standard error 95% confidence interval household expenditure HHs (MWK) (MWK) lower band upper band Malawi 243 4 236 251 3,111,328 9,083,805,926 - Urban 385 16 353 417 497,812 2,301,655,020 Rural 217 3 211 224 2,613,515 6,807,136,559 - North 245 7 230 259 364,814 1,070,613,948 Central 281 7 268 295 1,299,495 4,385,983,637 Southern 210 5 201 219 1,447,019 3,645,930,992 - Chitipa 232 18 198 267 39,427 109,896,080 Karonga 228 10 209 248 59,533 162,923,723 Nkhatabay 258 18 223 293 43,394 134,305,709 Rumphi 250 12 227 272 37,662 112,854,869 Mzimba 220 12 197 244 150,811 398,906,584 Likoma 2,168 - Mzuzu City 381 42 299 464 31,819 145,566,424 Kasungu 385 18 350 420 136,962 633,229,686 Nkhotakota 268 24 221 315 64,988 208,794,572 Ntchisi 295 22 251 339 51,284 181,403,970 Dowa 375 19 338 412 130,660 588,005,905 Salima 187 15 157 217 81,047 181,667,504 Lilongwe 222 16 191 254 293,662 783,689,554 Mchinji 253 20 214 293 103,432 314,485,877 Dedza 153 11 131 175 153,721 282,387,811 Ntcheu 167 10 146 187 119,783 239,521,089 Lilongwe City 468 39 391 545 163,956 920,142,664 Mangochi 175 6 164 187 195,983 412,071,533 Machinga 167 8 151 183 123,782 247,929,990 Zomba Non-City 218 12 195 241 147,447 386,200,333 Chiradzulu 2 74 22 231 317 74,036 243,369,741 Blantyre 266 24 220 313 86,351 275,851,758 Mwanza 183 13 158 208 23,071 50,592,867 Thyolo 166 7 153 180 146,448 291,853,056 Mulanje 219 17 187 252 131,581 345,992,028 Phalombe 233 22 190 277 79,813 223,412,213 Chikwawa 130 11 108 152 101,639 158,406,929 Nsanje 121 8 105 138 54,142 78,770,500 Balaka 164 12 141 187 79,775 157,219,485 Neno 182 9 165 199 25,981 56,801,087 Zomba City 460 48 366 553 19,939 109,966,396 Blantyre City 310 25 261 358 157,032 583,384,014
Source: Authors’ analysis of IHS 3 data * the number of households is based on a linear interpolation between the two censuses WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 71 PUBLIC EXPENDITURE REVIEW
TABLE 37 Household expenditure 2010-2016 (MWK 2016 prices)
2010 2010 2016 Average HH expenditure (MWK Bn -2010 prices) (MWK Bn – 2016 prices) (MWK Bn – 2016 prices) (2016-MWK) Malawi 5.91 16.04 35.14 9,329 Urban 5.15 13.98 22.51 37,355 Rural 0.88 2.40 8.65 2,734 North 0.52 1.41 4.94 11,100 Central 2.03 5.51 13.22 8,215 Southern 3.36 9.12 1 7. 1 9 10,043 Source: Authors’ analysis of IHS 3 and IHS4 data
ANNEX G - STAKEHOLDER MAPPING IN RURAL WATER SUPPLIES
As part of a political economy analysis ODI conducted a and interest in maintaining supplies are predominantly funding stakeholder mapping to assess the power and interest and policy making organisations. In the view of the PER team of different groups in maintaining water supplies. This is this strengthens the case for those organisations with the most reproduced in Figure 48. This mapping seeks to highlight that influence supporting those at the frontline with aligned interests those at the frontline of maintaining functionality have the least in water point functionality. power or influence. While those with the most power/influence
IGURE R
H Fi E i P i D v P i IWD P i i i i D W W UNICEF D E v i C WE NET D i i Fi N O 1 i NCIC Di i C i i i W D Di N O 2 R DWDO i B EC DC B W
P i v v P i VDC WPC i D E v i W L
L I i i i i RW H
EY ADC D v C i AEC Ex iv C i D D D D v D C Di i C i i Di i Ex iv C i Di i C i i T T i i i i DWDO Di i W D v O i E E vi i i AIWD i i i I i i W D v NCIC N i C i I C i NGO W P W Vi i W i C U iv U i P NGO E R i I i C i PCI C W i O L i R C VDC Vi D v C i WESNET W E vi i i N W A W i i i x i WPC W P i C i WSWG W W i
S ODI (2018) – blue circles and arrow added by PER authors’ for illustrative purposes MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 72
ANNEX H - SECTOR STAFFING AND PE COSTS
As part of the data collection for the PER a questionnaire was sent to all districts asking them to report on staffing levels. Below we present the results of these returns for the districts that responded.
TABLE 38 District-level staffing – sanitation
Change over HAS: Total previous four Population HO EHO
SAE - population CHPO SEHO SHSA SHPO AEHO AHEO DEHO ACHO H.S.As years
Mwanza 1 5 4 40 30 80 -10 130,949 4,365
Neno 1 8 37 28 74 -6 138,291 4,939
Blantyre 1 3 7 52 615 678 -381 1,251,484 2,035
Balaka 1 1 1 8 264 275 -26 438,379 1,661
Karonga 1 1 4 1 45 115 167 -18 365,028 3,174
Mulanje 1 1 1 7 2 45 342 399 -30 684,107 2,000
Nkhotakota 1 8 208 217 - 393,077 1,890
Thyolo 1 1 1 1 48 401 453 0 721,456 1,799
Zomba 1 2 7 52 533 595 -38 851,737 1,598
Dowa 16 416 432 -2 772,569 1,857
Chiradzulu 1 4 8 205 218 - 356,875 1,741
Likoma 1 2 8 11 - 14,527 1,816
Chikwawa 1 11 42 224 278 0 564,684 2,521
Nsanje 1 1 6 1 42 112 4 167 - 299,168 2,671
Rumphi 1 7 133 141 - 229,161 1,723
Dedza 1 11 42 359 413 -41 830,512 2,313
Kasungu 1 1 2 10 43 463 520 - 842,953 1,821
Machinga 1 4 5 311 321 735,438 2,365
Mchinji 1 1 2 7 330 341 - 602,305 1,825
Chitipa 1 1 2 4 1 44 77 130 - 234,927 3,051
Salima 1 1 2 14 3 2 74 295 -72 478,346 1,746
Lilongwe 1 7 20 1127 1155 -36 2,626,901 2,331
Nkhata bay 1 1 4 136 142 284,681 2,093
Ntchisi 12 48 127 187 317,069 2,497
Mangochi 1 18 49 437 505 -30 1,148,611 2,628
Phalombe 1 11 218 1 231 0 429,450 1,970
Ntcheu 1 1 5 48 309 364 - 659,608 2,135
Mzimba 1 2 0 16 7 0 0 29 549 1 0 605 1,161,456 2,116
Totals 6 21 10 94 141 25 8 677 7802 1 4 8789 17,563,749 2,251
Annual cost per individual 5.9 4.1 3.8 3.2 1.8 1.8 2.1 1.2 1.3 1.2 1.8 - (MWK m) Total annual PE estimate 41.1 94.0 38.5 351.5 269.7 45.6 16.8 813.0 10,649.8 2.3 7. 3 12,329.4 (MWK m) Source: district reports to PER team WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 73 PUBLIC EXPENDITURE REVIEW
TABLE 39 District-level staffing – water
Changes - in com- parison WMA Total Population ator AHO
BMO WPO with 4 Population WMA Water Water CWSO DWDO GWDA SCWSO ACWSO AHRMO previous supervisor Plant oper Water Asst. Water
Gauging Asst. years
Chiradzulu 1 4 5 3 356,875 89,218.75
Chikwawa 1 1 1 3 1 2 2 11 0 564,684 188,228.00
Salima 1 1 3 2 1 8 1 478,346 159,448.67
Phalombe 1 1 2 1 5 0 429,450 214,725.00
Dowa 1 4 1 1 7 2 772,569 193,142.25
Karonga 1 4 1 6 1 365,028 91,257.00
Ntcheu 1 3 6 1 1 12 0 659,608 109,934.67
Mangochi 1 4 17 2 24 1,148,611 67,565.35
Balaka 1 2 3 6 1 13 438,379 219,189.50
Blantyre 1 3 3 7 0 1,251,484 417,161.33
Chitipa 1 4 1 1 1 8 2 234,927 58,731.75
Dedza 2 2 4 0 830,512 -
Kasungu 1 3 2 6 0 842,953 -
Mchinji 1 1 3 5 - 602,305 200,768.33
Mwanza 1 1 2 -3 130,949 130,949.00
Mzimba 1 4 2 7 1,161,456 290,364.00
NkhataBay 1 1 1 1 2 6 0 284,681 284,681.00
Nkhotakota 1 1 2 1 5 0 393,077 196,538.50
Thyolo 1 1 3 1 6 0 721,456 240,485.33
Zomba 1 2 1 4 8 0 851,737 -
Mulanje 1 2 1 4 -2 684,107 342,053.50
Lilongwe 1 1 1 4 1 4 12 2,626,901 656,725.25
Ntchisi 2 1 3 0 317,069 -
Nsanje 1 1 1 1 4 -3 299,168 299,168.00
Likoma 1 2 3 0 14,527 -
Rumphi 1 2 4 3 10 - 229,161 57,290.25
Machinga 1 1 2 4 - 735,438 735,438.00
Neno 2 1 3 -2 138,291 69,145.50
Totals 9 7 7 11 8 6 80 7 1 7 40 10 3 2 198 17,563,749 219,546.86
Annual cost per individual 2.7 2.6 2.6 1.5 1.5 1.5 1.4 1.3 1.3 1.3 1.3 1.3 1.3 1.3 (MWK m) Total annual PE estimate 24.3 18.2 18.2 16.5 12 9 112 9.1 1.3 9.1 52 13 3.9 2.6 301.2 (MWK m) Source: district reports to PER team MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 74
ANNEX I - STAKEHOLDERS INTERVIEWED
Area Name Role District-level stakeholders interviewed Nkhotakota District Dr Matchaya DC Malani Moyo Acting DPD Mr Nyasulu Acting DOF Ephraim Mbewa DEHO Enea Mfipa WASH Coordinator Maggie Mugala HSA Mr Nkhuwa WMA Mr Chimutu WUA Rumphi District Steve Chima Director of Administration Frank Mkandawire Director of Planning and Development Musandide Fredrick Misinjo Director of Finance John Mpoha District Environmental Health Officer Mkanani WASH Coordinator John Chingawale District Water Development Officer Alfred Chiwaka Health Surveillance Assistant Godfrey Mhango Health Surveillance Assistant Sara Msisya Health Surveillance Assistant Steve Msowoya Water Monitoring Assistant Suzgo Viyuwi Chairperson of Ng’onga WUA Bridget kamunga Member of Ng;onga WUA Fika Mtete Member of Ng’onga WUA Phalombe District Osman Bwanali Director of Administration (DoA) Joseph Mtiza Director of Finance Smith Majoni Local Development Fund Officer Dave Chibani Disaster Management Officer Chimwemwe Jella DEHO Boston Tambala DWDO Funny Mbingwani Health Surveillance Assistant John Limited Health Surveillance Assistant Mr Masuku Health Surveillance Assistant George Mpombwe Migowi Water User Association Board Chairperson Vera Mangondo Migowi Water User Association Board member Minjolo Makheala Migowi Water User Association Board Treasurer Kefati Maenje Migowi Water User Association Board secretary Jennifer Chinjiko Migowi Water User Association Office clerk Stanford Khumbanyiwa Caretaker Jean Manyozo Migowi Water User Association Board member Princess Makina Migowi Water User Association Board Vice secretary Alex Saad Water Monitoring Assistant Levi Kadambo Water Monitoring Assistant Patron Kalonga Water Supervisor Chikwawa District Douglas Moffatt Chief DPD Crispen Songola DWDO Veronica Nkukumila DEHO Peter Ngondo EHO WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 75 PUBLIC EXPENDITURE REVIEW
Chikwawa District Francis Kadzokoya District Disaster Management Officer Tanya Hendricks Research Intern, DoDMA Philemon Sande Acting Misiufolo WUA Scheme Manager Pastor E. Jombo Secretary, Misiufolo WUA Roy Ulili Misiufolo WUA Chair Raphael Kalima Misiufolo WUA Treasurer Mtsogoli Ganamba Senior HSA Mcmocks Khembo Senior HSA McRobreez Lundu Senior HSA Elizabeth Kwelepeta Water for People Chikwawa District Coordinator Mangochi District Mr. Sadi Director of Finance Mr. Edward Maferano Assistant. Director of Finance Mr. Kondwani Andrea District Water Development Officer Mr. Hassan Maluwa Senior Water Monitoring Assistant/ICT Mr. Hendricks Banda Coordinator (Local Utility Operator), Koche Water Users Association Mr. Caesar Mpata Member, Koche Water Users Association Mr. Bright Kuyaka Treasurer, Koche Water Users Association Mr. Enerst Kaphuka Director of Planning Mrs. Ellian M. Makunje Monitoring &Evaluation Officer Mr. C Mamba District Environmental Health Officer Mr. Vincent Dumba Health Surveillance Assistant Mr. Boyd Nkhonjera Health Surveillance Assistant Machinga District Mr.William Zuza Deputy DEHO Mr. Kaliya DEHO Mr Zuza WASH Coordinator Mr. Steven Meja District Water and Development Officer Mr. John Twaya Treasurer, MKula Water Users Association Mr. Chibundo Water Monitoring Assistant Mr. Solomon Mkundika Director of Finance Mr. Mike Kanthumba Senior Health Surveillance Assistant Mr. Wasili Akimu Scheme Manager, Mkula Water User Association-Machinga Mr. MacMillan Mbewe Board Chair, Mkula Water User Association Kasungu District Charles Mwenda DWDO Kazonde EHO Acklean Thomas WMA’s Blessings Nkhoma DPD Charles Manzi DOF District questionnaire respondents Ntchisi District Council James Mtonga District Environment Health Officer Nkhatabay District Council Wilson Kamanga EHO - WASH Coordinator Blantyre District Council Penjani Chunda District Environmental Health Officer Balaka District Council Thomas Mchipha Principal Environmental Health officer- (District Environmen- tal Health Officer) Karonga District Council Lewis Tukula District Environmental Health Officer/Principal Environmental Health Officer Mulanje District Council Thomson Kajombo Chief Preventive Health Officer Nkhotakota District Council Chandiwira jere DEHO Thyolo District Council George Chitimbe Chief Preventive Health Officer, head of EH department Mzimba South Jimmy Chilinda WASH coordinator (Mzimba South DHO) Zomba District Council Innocent Mvula CHIEF PREVENTIVE HEALTH OFFICER MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 76
Dowa District Council Joseph Lwesya EHO - WASH Chiradzulu District Council Noel H Zondola District Environmental Heath Officer Likoma District Council Owner Ngulube DEHO Chikwawa District Council Veronica Mkukumila DEHO Nsanje District Council Fred Minyaliwa District Environmental Health Officer Rumphi District Council O’John Mpoha DEHO Dedza District Council Rudolf Zinkanda Banda District Environmental Health Officer Kasungu District Council Ben Mitochi District Environmental Health Officer . Machinga District Council Mathews Jason Kalaya District Environmental Health Officer Mchinji District Council Robson Kayira District Environmental Health Officer Chitipa District Council Sam Madongo Chirwa Principal Environmental Health Officer (PEHO) Salima District Council Reuben Chikadza District Environmental Health Officer Lilongwe District Council Paul Chunga District Environmental Health Officer Mwanza District Council Blessings Chitsime District Environmental Health Officer Neno District Council Margaret Chinguwo Mikwamba District Environmental Health Officer Mzimba North District Health Office Grace Funsani Principal Environmental Health Officer Mangochi District Council Dr. Kondwani Mamba District Environmental Health Officer Phalombe District Council Chimwemwe Dickson Jella District Environmental Health Officer Ntcheu District Council Bosco Kaluwa Chief Preventive Health Officer Chiradzulu District Council Macpherson Kuseli Assistant Community Water Supply Officer Chikwawa District Council Chrispine Songola DWDO Salima District Council Waki Martin Chungwa District Water Development Officer Phalombe District Council Boston Tambala District Water Development Officer Dowa District Council Timothy Banda District Water Development Officer Karonga District Council Jacob Mkandawire Community Water Supply and Sanitation Officer Ntcheu District Council Onances Luke Nyirenda DWDO Mangochi District Council Kondwani Andreah District Water Development Officer Balaka District Council Bridget C. Banda Community Water Supply Sanitation Officer BlantyreDistrict Council Kizito Uzamba Acting District Water Development Officer Chitipa District Council Harry Chambukeni Mlauzi District water development officer Dedza district council Zione Kamtambe District water development officer Kasungu District Council Charles Mwenda Charles Mwenda Mchinji District Council Mike Chilimmadzi District Water Development Officer Mwanza District Council Laston Chagunda District Water Development Officer(DWDO) Mmbelwa District Council Kings Mdhluli Community Water Supply Officer. Nkhata-Bay District Council Alex Mwanjasi Mwakikunga District Water Development Officer Nkhotakota District Council Ephraim Chasiya Mbewa District Water Development Officer Thyolo District Council JAMES E. MSELELA DISTRICT WATER DEVELOPMENT OFFICER Zomba District Council Davis Tayanjana Bonga District Water Development officer Mulanje District Council Edwin Mchirikizo Senior Community Water Supply and Sanitation Officer, SCWSSO (administratively called District Water Develop- ment Officer, DWDO) Lilongwe District Council Marvel Tibu Senior Community Water Supply and Sanitation Officer Ntchisi District Council Peter N. Moyo District Water Development Officer Nsanje District Council John Chilapula Acting District Water Development Officer Likoma District Council Vincent Horowanya DWDO Rumphi District Council John Chingawale DWDO Machinga District Council Steve Meja District Water Development Officer Neno District Council James Yolamu Mando Water Monitoring Assistant (Ag : DWDO) WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 77 PUBLIC EXPENDITURE REVIEW
ANNEX J - SPECIFIC SOURCES, ASSUMPTIONS AND CALCULATIONS
BOX 3 Sources, assumptions and calculations of water sector GoM expenditures
The following approaches:
PE in districts is based on numbers of water staff in each job reported by DWDOs in each district for 2018/19, multiplied by average PE costs for each job. The result for 2018/19 is then pro-rated over each previous year based on GoM-wide total pay in each year, given that DWDOs were reporting no significance change in staff numbers over the 5 years.
ORT in districts is based are based on Treasury reports of funding of the Water sector in each year, assuming that 95% of this funding is used in the year on Water ORT.
Development in districts is based on Treasury reports of funding to each of the Borehole Fund, the District Development Fund (DDF) and the Constituency Development Fund (CDF), with the assumptions that 100%, 20% and 5% were spent on Water in each year for each of the Borehole Fund, DDF and CDF respectively. These proportions are estimates for each fund based on the average result reported by 11 districts.
Development in cities is based on the information that, in Lilongwe City Council, none of the Borehole Fund was used in 2017/18 and only 13% in 2018/1964. The same outcome has been applied to all 4 cities.
Locally Generated Revenue. No data is available for water sector expenditure implemented using LGR, but such expenditure is understood to be rare and low.
PE in MoAIWD department is based on IFMIS data for all Water and Irrigation departments in each year. Since the IFMIS data does not distinguish the Water Supplies department alone, the department’s proportion of the total has been estimated.
ORT in MoAIWD department has been similarly based on IFMIS data with an estimate for the Water Supplies department’s share.
Development Part 2 in MoAIWD is based on identification of those projects budgeted in each year by MoAIWD that are con- cerned with water supplies. The proportions funded and spent are based on IFMIS data, and clarified in consultation with the MoAIWD.
Emergency is based on consultation with the Department of Disaster Management Affairs.
64 The reason for this is that City planning regulations (all four cities) prohibit construction of boreholes in high density locations (where they are needed most) due to pit latrines which are found in BOXalmost 4 Sources, every house assumptionsin these locales. In 2018/19, and itcalculations was only in Lilongwe of Southsanitation West where and the Borehole hygiene Fund wasGoM used, expenditures because the density of pit latrines there is comparatively low. MALAWI FEBRUARY 2020 WATER, SANITATION AND HYGIENE SECTOR PUBLIC EXPENDITURE REVIEW 78
PE in districts is based on numbers of environmental health staff in each job reported by DEHOs in each district for 2018/19, multiplied by average PE costs for each job. The result for 2018/19 is then pro-rated over each previous year based on GoM-wide total pay in each year, given that DEHOs were reporting no significance change in staff numbers over the 5 years.
ORT in districts is based on Treasury reports of funding of the Health sector in each year, assuming that 1.5% of this funding is used in the year on H&S.
Development in districts is based on Treasury reports of funding to each of the District Development Fund (DDF) and the Constituency Development Fund (CDF), with the assumptions that 3% and 1% were spent on in each year for each of DDF and CDF respectively. These proportions are estimates for each fund.
Locally Generated Revenue in districts. No data is available for H&S expenditure implemented using LGR, but such use is understood to be rare and low.
PE in cities is based on data from Lilongwe City Council extrapolated to all 4 cities. PE in Lilongwe City Council includes sew- erage officers and 10% of the cost of preventive health officers (10% being an estimate of the proportion of the time spent on WASH).
ORT in cities is based on data from Lilongwe City Council extrapolated to all 4 cities. It includes the sewerage and 10% of preventive health. Note that all this ORT is funded by Local Government Revenue.
PE in MoHP environmental health is based on IFMIS data for all MoHP in each year. Since the IFMIS data does not distin- guish the environmental health department alone, the department’s proportion of the total has been estimated.
ORT in MoHP department has been similarly based on IFMIS data with an estimate for H&S’s share.
Development Part 2 in MoHP is zero as no MoHP development Part 2 projects have been recognised as being for H&S.
Emergency is based on consultation with the Department of Disaster Management Affairs.
BOX 5 Assumptions for sub-sector analysis
GoM: Expenditure through the water sector has been separately identified by source above (e.g. through MoAIWD vs MoHP). Also, expenditures through city councils have been classified as urban. In addition, 5% of MDA PE and ORT expenditure has been assumed to be incurred on support of the urban sub-sector.
Donor expenditure has been analysed into sub-sectors using CRS codes and making appropriate assumptions (e.g. that the code for ‘large water systems’ represents urban). Some extrapolations were made using data provided through the DP ques- tionnaires, especially for the period after the latest CRS data (i.e. for beyond 31 December 2017).
Expenditures through Water Boards are assumed to be exclusively urban. WATER, SANITATION AND HYGIENE SECTOR MALAWI FEBRUARY 2020 79 PUBLIC EXPENDITURE REVIEW
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